Ukraine is the latest country to legalize bitcoin as the cryptocurrency slowly goes global
Ukraine is the fifth country in as many weeks to lay down some ground rules for the cryptocurrency market, a sign that governments around the world are realizing that bitcoin is here to stay.
In a nearly unanimous vote, the Ukrainian Parliament adopted a law that legalizes and regulates cryptocurrency. The bill was set in motion in 2020 – and heads to the desk of President Volodymyr Zelenskyy.
Until today, crypto in Ukraine has existed in a legal gray area.
Locals were allowed to buy and exchange virtual currencies, but companies and exchanges dealing in crypto were often under close watch by law enforcement.
According to the Kyiv Post, authorities have trended toward taking a combative stance when it comes to virtual cash, regarding it as a “scam,” raiding crypto-related businesses, and “often confiscating expensive equipment without any grounds.”
In August, for example, the Security Service of Ukraine (SBU) blocked a network of what it called “clandestine cryptocurrency exchanges” running in the capital city Kyiv. The SBU claimed these exchanges were facilitating money laundering and providing anonymity of transactions.
The new legislation also spells out certain protections against fraud for those who own bitcoin and other cryptocurrencies, and in a first for Ukraine’s Verkhovna Rada unicameral parliament, lawmakers have taken a stab at defining core terminology in the world of crypto. If signed by the president, virtual assets, digital wallets and private keys are terms that will be enshrined in Ukrainian law.
Ukraine becomes the latest country to legalise Bitcoin and cryptocurrencies
Ukraine’s parliament has adopted a new law that legalises and regulates cryptocurrency and other virtual assets like tokens.
The bill was passed in a near-unanimous vote on Wednesday and will now need to be signed by President Volodymyr Zelensky.
Ukraine is the fifth country in as many weeks to set up ground rules for digital currencies following El Salvador’s move to adopt Bitcoin as legal tender.
What does the bill change?
But Ukraine has not gone as far as El Salvador, which accepts Bitcoin as an official form of payment alongside US dollars.
According to the Ukrainian draft bill, the law will regulate “legal relations arising in connection with the turnover of virtual assets in Ukraine, defines the rights and obligations of participants in the virtual assets market, the principles of state policy in the field of virtual assets”.
Put simply, the law will protect the owners of virtual assets and exchange platforms from fraud.
Cryptocurrencies in Ukraine have long been in a grey area, being neither legal nor forbidden due to a lack of existing laws that defined them and their usage.
El Salvador is hedging its bets on Bitcoin and accepts the crypto as legal tender. MARVIN RECINOS/AFP
While buying and exchanging cryptos was allowed, local courts could not protect people in cases of fraud or if something went wrong.
According to the Kyiv Post newspaper, authorities have typically regarded digital cash and cryptos as a “scam” and have raided crypto-related businesses and even confiscated equipment “without any grounds”.
Ukraine’s crypto future
The draft law may also determine how Ukraine will regulate cryptos in the future. The country plans to open up the cryptocurrency market to businesses and investors by 2022, a spokesperson from the Ministry of Digital Transformation told the Kyiv Post.
Ukraine’s Minister of Digital Transformation Mykhailo Fedorov also recently said the country was modernising its payment market so that its National Bank could issue digital currency.
There is a growing number of governments trying to regulate cryptocurrencies. Besides Ukraine and El Salvador, Cuba and Germany have also made strides.
Panama could be the next country to regulate cryptos as it is currently considering a draft law.
Ukraine legalizes cryptos
NEW
A vastly improved search engine helps you find the latest on companies, business leaders, and news more easily.