Bitcoin, more like cryptocurrency, is here to stay. Although cryptocurrency is banned in several countries, some governments see potentials in it. El Salvador recently adopted Bitcoin as a legal tender; citizens can buy, sell, pay taxes, etc., using Bitcoin.
Ukraine has passed a law that legalizes the use of Bitcoin in the country. The newly adopted law was first passed as a bill in 2020. The law takes Bitcoin out of the legal gray area where it has been existing.
Bitcoin becoming legal in Ukraine is completely different from the El Salvador situation. While Bitcoin can be used to make payments for goods, services, pay taxes, and complete transactions just like the official currency in El Salvador, legalizing Bitcoin in Ukraine does not put it on par with the hryvnia; the country’s currency. Bitcoin, although legal, cannot be used to make purchases, payments, pay taxes, etc., in Ukraine.
Before the newly passed, cryptocurrency-related activities existed in the country but companies who provided these services were under scrutiny from regulators. Like many regulators, Ukraine has also had its trend of calling out cryptocurrency platforms for various reasons.
Last month, for instance, Ukraine’s regulator, the Security Service of Ukraine (SBU), flagged a platform running in the capital city of Kyiv tagging it and other’s “clandestine cryptocurrency exchanges”. These exchanges were facilitating money laundering and providing anonymity of transactions, the regulator said.
The new law spells out protection for citizens who hold Bitcoin and other cryptocurrencies, thus protecting them against fraud and making them less susceptible to cryptocurrency-related harms. Virtual assets, digital wallets, and private keys are terms that will be enshrined in the law.
Ukraine plans on opening its cryptocurrency market to investors and businesses by 2022, according to newspaper sources.
Speaking on the development, CEO of Bitcoin R&D lab Judica said that “Ukraine’s improved legal status for bitcoin is a laudable symbolic measure that we progress towards a world that respects individual rights universally. But it is only symbolic — bitcoin seeks neither permission nor forgiveness in its mission to protect persecuted communities from unjust governments.”
Ukraine’s move is expected to be followed by some countries. Last month, Cuba, known for being a conservative government, passed a law to recognize and regulate cryptocurrencies, citing “reasons of socioeconomic interest”. Panama, another Central American country, is already drafting its laws in favor of Bitcoin.