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Ukraine Rushes to Utilize 'Huge Potential' of Crypto Industry

Ukraine Rushes to Utilize 'Huge Potential' of Crypto Industry 101
The Bohdan Khmelnytsky Monument in Kiev. Source: iStock/AlexeyZel

Ukraine’s parliament is looking to push through cryptocurrency regulation in the final months of 2019. The country looks set to introduce crypto tax laws “before New Year,” with MPs speaking of the cryptocurrency industry providing “huge potential for economic growth.”

Per a Facebook post from MP Alexey Zhmerenetsky, a group of 50 parliamentarians have drafted two cryptocurrency bills in conjunction with blockchain business groups, pro-blockchain lobbyists and the country’s Ministry of Digital Affairs.

The bills, which have now been shared online, are open for public consultation for the next two weeks, after which, Zhmerenetsky noted, they will be brought before the country’s parliament.

The MP wrote,

“We will ask President Volodymyr Zelensky to consider the bills as urgent, because [they will provide] a huge potential for economic growth amounting to billions of dollars. Before we welcome in 2020, we will have launched a new era of blockchain-powered economics in Ukraine.”

The first bill requires individuals and companies to report cryptocurrency transactions in excess of USD 1,200 to financial regulators, providing seller and buyer information, including personal data, company information and wallet addresses.

The second bill classifies tokens into two categories: “token-assets” and “crypto-assets.” The second category includes tokens that do not “imply” property rights, and would include Bitcoin and most major altcoins. This is the category that would be subject to taxation.

The bills also contain measures that would force companies in Ukraine dealing with cryptocurrencies to comply with anti-money laundering protocols.

But perhaps more importantly, they would provide a legal basis for cryptocurrencies, which are currently unregulated in Ukraine – a situation that Zelensky wants to redress as soon as possible.

Earlier this month, the Ministry of Digital Affairs announced that it wants to provide legal definitions of cryptocurrencies and other blockchain-related terms, also before year’s end. The ministry also hopes to provide miners with a legal footing.

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