Ukraine has enacted a draft bill that acknowledges the digital currency business and establishes regulations for it. The new law gives virtual asset owners security and permits enterprises that provide digital currency services to register bank accounts.
Ukraine’s parliament almost unanimously passed the Verkhovna Rada bill last week, giving digital currencies legal status in the Eastern European country. The law, dubbed “On Virtual Assets,” defines virtual assets as intangible assets expressed as computer data. It also defines private keys and digital currency wallets.
The new measure will be presented to the president of Ukraine, Volodymyr Zelensky, who will sign it into law.
In recent years, Ukraine has emerged as a global powerhouse in the digital currency field. It is ranked fourth in the Chainalysis Global Crypto Adoption Index 2021 in terms of overall adoption. In addition, it was ranked first last year and was the only country to receive a perfect score of one.
Despite their popularity, digital currencies have remained in a legal gray area. Ukrainians have been given complete freedom to obtain and own digital currency. But, according to a study published in the Kyiv Post, the story has been different for enterprises.
Authorities are said to have taken a confrontational posture against the industry, raiding virtual asset companies on the spur of the moment and even seizing pricey and crucial equipment without cause. As a result, like those in many other countries, these enterprises have found it impossible to obtain basic banking services.
While digital currencies will now have legal standing, they will not be recognized as legal money, which will continue to preserve the local hryvnia. In addition, Ukraine has borrowed a page from its neighbor Russia’s regulatory book, prohibiting transfers in digital currencies.
Thanks to the new bill, the Ministry of Digital Transformation now has control over the digital currency business. According to the Ministry, the new bill will provide new chances for enterprises in the country while also contributing to the government’s tax coffers.