Just 2 days after El Salvador became the first country to adopt BTC as legal tender, Ukraine legalizes Bitcoin and incorporates the king of crypto’s into its economy.
The long awaited law on virtual assets has been passed by parliament in the former Soviet state which effectively means that Ukraine legalizes Bitcoin, becoming the 5th country in the world to adopt laws which give legal status to BTC, along with the introduction of new regulation to govern usage.
“Only a few countries in the world have legalized crypto assets — Germany, Luxembourg, Singapore. Ukraine will be one of them…. Favorable conditions will allow companies to register in Ukraine, rather than abroad. The entrepreneurs will pay taxes to the budget, but will be protected by the state”Mykhailo Fedorov, Minister of Digital Transformation
Crypto businesses may boom as Ukraine Legalizes Bitcoin
Before today, although Ukraine has very much been seen as a hub for blockchain development, however it’s not always been regarded as the mostly friendly towards cryptocurrency, and there were no clear rules governing Bitcoin and other digital assets in the country.
Whilst Ukrainian’s could buy and sell via exchanges, under the watchful gaze of the countries authorities, there was a widespread distrust amongst the government over digital currencies, with many believing that it was a scam. This resulted in some pretty heavy-handed crackdowns on crypto-related companies, including confiscations of equipment owned by companies which the Security Services (SBU) designated as ‘clandestine cryptocurrency exchanges’ in the capital Kiev, often without having to provide any justification or citing the breaking of any specific laws.
The bill, which was filed and began its long journey through the countries legislative process will now land on the desk of President Volodymyr Zelensky. The new rules under which the bill has come into law include measures to protect users from fraud as well as definitions of terminology used in the crypto universe. This is significant because these terms have never previously been used in the countries legislation before, however they will be enshrined now as Ukraine legalizes Bitcoin in law.
Assuming that the President approves the bill, terms such as ‘digital wallet’ and ‘private keys’ will be incorporated into the countries core terminologies, and there is no reason to suggest he would block the bill, having previously stated he thinks that investment in the country would get a boost when Ukraine legalizes Bitcoin.
However, it should be noted that although the new laws do not mean that Ukraine has followed in the footsteps of El Salvador, which earlier this week made Bitcoin legal tender, as the country has not put BTC on an equal footing with the national currency, the Hryvnia.
Ukraine plans to open the cryptocurrency market to businesses and investors as early as next year, according to the Kyiv Post.
“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.”Jeremy Rubin, CEO of Judica
276 Ukrainian lawmakes voted in favour of the bill out of a total of 450 members of the Rada (parliament of Ukraine), which will now allow crypto businesses to officially work (and of course pay taxes) in the country. In order to register a crypto business, a company must prove it is transparent and has an ‘excellent reputation’ although it is not clear at this time exactly what that means. Gaining the required permits will cost the business around $3100, which is very reasonable considering the sorts of profit that crypto businesses can make with a good user base.