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Ukraine Legalises Bitcoin

Ukraine Legalises Bitcoin

Ukraine Legalises Bitcoin: Ukraine is making significant strides in the world of cryptocurrencies. Just recently, on February 17th, the Ukrainian parliament passed a crucial bill to give cryptocurrencies, such as Bitcoin, official legal status. This move paves the way for the establishment of clear regulations and management guidelines for digital assets. As Deputy Prime Minister and Minister of Digital Transformation Mykhailo Fedorov stated on Twitter, this decision means that crypto exchanges and cryptocurrencies will be fully legalized. This not only promotes a safer environment for Ukrainians to trade in the crypto space but also helps protect their assets from potential misuse or fraud.

Key Points

In September of the previous year, Ukraine’s parliament approved a law to legalize cryptocurrencies. However, President Volodymyr Zelenskyy decided to veto the bill just a month later. Zelenskyy expressed concerns about the financial burden of establishing a new regulatory framework for overseeing cryptocurrency in Ukraine.

  1. The latest version of the virtual assets law, which was approved by parliament on Thursday, places cryptocurrency regulation under the supervision of the National Commission on Securities and Stock Market, following President Zelenskyy’s suggestion.
  2. It’s worth noting that this bill does not grant legal tender status to Bitcoin or other cryptocurrencies. Unlike El Salvador, Ukraine has not taken the step of adopting Bitcoin as an official currency, as El Salvador did in September last year. However, this new law aims to provide assurance to businesses that were previously operating in a legal gray area.
  3. According to Fedorov, in an official statement, “Market participants will now have legal protection and the opportunity to engage in open consultations with government agencies to make informed decisions.”

What earlier

Ukraine has emerged as a thriving crypto industry hub in Europe, even without formal regulation in the past. According to Chainalysis’ 2021 Global Crypto Adoption Index, Ukraine secured the fourth spot globally, ranking behind only Vietnam, India, and Pakistan. This index assesses a country’s crypto trading volume and value. Remarkably, Ukraine conducts more daily cryptocurrency transactions than transactions in its own fiat currency, the hryvnia. Furthermore, Ukraine boasts a highly skilled developer workforce ready to explore the world of blockchain technology. In 2021, Dutch IT company Daxx recognized Ukraine as the top choice for IT outsourcing attractiveness and the world’s best destination for hiring programmers.

Get more investment

  • The government is optimistic that the recent legislation will encourage greater foreign investment in Ukraine’s growing cryptocurrency market. However, ongoing tensions with Russia, which has a less favorable stance on cryptocurrencies, could potentially impact the influx of capital.
  • Just recently, there were reports of mortar shells hitting a kindergarten in the troubled eastern region of Ukraine. Pro-Russia separatists attributed the incident to Ukrainian forces, while Ukrainian forces placed the blame on pro-Russia separatists.

War Looming

  • In addition to the concern of potential military conflict, Russia’s economic influence and its uncertain stance on cryptocurrency could cast a shadow over Ukraine’s welcoming attitude.
  • Russia continues to be one of Ukraine’s significant trading partners, and the Russian central bank is in the process of developing its own digital currency while advocating for a ban on cryptocurrencies.
  • Ukraine’s Deputy Minister of Digital Transformation, Oleksandr Bornyakov, pointed out in January that their positive approach to cryptocurrencies is quite distinct from neighboring countries where officials are considering banning the use and mining of digital currencies.
  • Bornyakov emphasized that effective crypto regulation can yield better results than an outright ban.

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