On Thursday, cryptocurrencies became legal in Ukraine following a vote in favour of a bill that granted cryptocurrencies legal status in the country. Although it is still not a legal tender like Bitcoin in El Salvador, the country is the latest to provide a regulatory framework for cryptocurrencies and virtual assets. While the bill had two votes against it, there were three hundred votes in favour of it.
The bill passes gives cryptocurrencies and virtual assets a basic regulatory framework. Described as “virtual assets” in the bill while referring to cryptocurrencies such as Bitcoin, these virtual assets refer to assets that cannot be traded legally or used as a payment option or traded for other assets, goods and services. Now that the bill has been passed, these cryptocurrencies have a legal status and give Ukrainian citizens the prerogative to store and use these virtual assets. Apart from that, it defines how cryptocurrency market participants ought to operate.
A statement by the Ukrainian Minister of Digital Transformation Mykhaylo Fedorov reads, “The new law is an additional opportunity for business development in our country. Foreign and Ukrainian crypto companies will be able to operate legally, and Ukrainians will have convenient and secure access to the global market for virtual assets”. It also added that Ukraine’s National Securities Commission would act as the major regulator for virtual assets and any future asset market.
The bill was first issued in September and cleared in October by the Ukrainian parliament but was vetoed by President Volodymyr Zelensky. An amendment followed suit and legal mechanisms that needed to be put in place to meet constitutional requirements were added.
Serhiy Tron, founder of White Rock Management and the Parea Foundation international fund, while speaking to Bitcoin Magazine said that “The Law on Virtual Assets is largely a framework law and requires further substantial refinements, for instance, changes to the tax code. Nevertheless, the document became an important signal to the global community since the National Bank of Ukraine officially stated that digital currency is a ‘monetary surrogate, which has no real value”.
The minister of digital transformation also mentioned that the bill will help the country come to the forefront of the global Bitcoin and cryptocurrency market. “By creating a high-tech, innovative cryptocurrency market that plays by clear rules, the country expects the speedy arrival of crypto investors from all over the world”, he said.