The bill “On Virtual Assets,” which was approved by Ukraine President Volodymyr Zelenskyy, attempts to govern the country’s crypto economy. The clearance comes at a time when the country is increasingly becoming reliant on cryptocurrency contributions to take care of its defence needs and address humanitarian issues in the face of a Russian invasion.
President Zelenskyy Approves The Law On Cryptos
Ukraine President Volodymyr Zelenskyy has inked into law a bill establishing guidelines for bitcoin transactions. The “On Virtual Assets” law will allow crypto platforms to operate in the nation, which has been utilizing digital assets to fund defence operations and assist its civilian population in the face of Russian military aggression.
On Wednesday, the Ministry of Digital Transformation tweeted, “Ukraine has legalized the crypto industry.” From now on, international and Ukrainian cryptocurrency exchanges will be able to function legally, and banks will be able to register accounts for crypto enterprises.”
Virtual assets are divided into three categories under the legislation. Bitcoin and other cryptocurrencies are defined as ‘unsecured’ assets, as opposed to secured assets like profit-bearing security tokens. The third category, ‘financial’ virtual assets, includes financial instruments like tokenized equities, Stablecoins, and central bank digital currencies.
The Verkhovna Rada first approved the proposal in September, but Zelenskyy returned it the following month, requesting regulatory body revisions. The Ukrainian parliament enacted the measure in mid-February after considering his proposals. Zelenskyy had 10 days to sign it before the conflict broke out.
The virtual assets legislation included the development of special crypto regulating agency before its most recent modification, but the Ukrainian president opposed the proposal, saying that it would cost the budget more money. Lawmakers agreed, and the digital ministry was stripped of its supervisory obligations.
Under the modified laws, the National Securities and Stock Market Commission (NSSMC) and the National Bank of Ukraine (NBU) would be the primary crypto regulators. The NBU will be in charge of overseeing the circulation of digital assets backed by other currencies, while the NSSMC will be in charge of overseeing the rest.
The commission will also grant permits to crypto service providers, observing their actions and keeping a registry of them. It is in charge of identifying infractions and levying financial penalties. The new regulation will provide legal protection for bitcoin owners’ other rights.
After Ukrainian lawmakers revise the country’s Tax Code, the law “On Virtual Assets” will take effect. Ukraine is a pioneer in terms of crypto adoption in Eastern Europe. The modifications are required to govern the taxes of crypto-related earnings and profits.
