As of today, cryptocurrency exchanges are recognised as an official activity in Ukraine by the Ukrainian Parliament.
Ukrainian authorities have been silent on cryptocurrency, including Bitcoin, which is a form of digital currency.
Even so, Chainalysis reported in September 2020 that Ukrainians were the number one cryptocurrency adopters in the world. In addition, citizens who own the crypto company will have legal protections if their crypto are stolen if the bill passes.
In 2019, the Ministry of Digital Transformation was created to promote digital literacy
The law was drafted by Access Economics, which is responsible for implementing the law, which will be in effect after the tax code is revised and the statute is signed by the president.
According to a 2019 report from the International Monetary Fund, Ukraine’s nominal GDP is not proportional to its population. By attracting crypto businesses, the Ministry hopes to increase that number.
Oleksander Bornyakov, deputy minister of state for economic development, said on the press that the introduction of specialized legislation in Ukraine will attract foreign exchanges. Developing the crypto sphere in Ukraine will be a powerful incentive.”
Eastern Europe, for instance, has a high rate of crypto usage or adoption, even if it’s not always legal or regulated. Chainalysis noted in its report that corruption and asset seizures were rampant in Ukraine and that banks had fallen into disrepute.
Over this past year, eight billion dollars worth of cryptocurrency were sent by consumers as a means of protecting their assets. Crypto businesses and exchanges could increase that number.
Over the past few months, MDT has been actively involved in crypto. As of January, it has formed a partnership with the Stellar Development Foundation to create a virtual currency for central banks modelled on the Ukrainian hryvnia, which the bank began developing four years ago.
Stellar would assist in developing the regulations and cryptocurrency infrastructure needed to make the country competitive in Eastern European markets as part of the agreement.