Ukraine Set To Legalize Cryptocurrencies As Means Of Payment And Investment

Good news came from Eastern Europe as the legislative arm of Ukraine, the Verkhovna Rada, has reportedly adopted an amended draft law that seeks to introduce cryptocurrencies as a legal means of payment and investment within the country.

According to a report, this development is an effort to work in accordance with the Financial Action Task Force (FATF) global standard for cryptocurrencies, which requires participating countries to provide guidelines for their individual crypto space. 

The original bill, which focused on the “prevention the legalization of proceeds from crime and the financing of terrorism and weapons of mass destruction proliferation,” was amended to include digital assets after its first reading. 

The amended draft described virtual assets as both property and a digital representation of value, which can be transferred, traded, or used as a medium of exchange for goods and services or investments. 

Not Without Caution

While Ukraine has welcomed cryptocurrencies with open arms, the country did not throw caution to the wind. Following the guidelines of the FATF, Ukraine also prepared an Anti-Money Laundering (AML) policy to oversee the operations in the cryptocurrency sector in the country. 

The Ministry of Digital Transformation will be responsible for regulating the circulation of cryptocurrencies within the country while ensuring that every participant in the crypto sector of Ukraine is fully compliant with the AML regulations. 

Crypto transactions will be monitored at different levels, depending on the amount involved in them. For example, as per the guidelines, sending below 30,000 hryvnias ($1,300) per transaction will require only the sender to submit their public key to the government for financial monitoring while transactions above that amount would require both the sender and recipient to verify their Identify as well as their business relationship. 

Just One More Step

Although the bill has passed its second reading, it still has to be adopted officially by the Verkhovna Rada and currently “being prepared for signing.” Once the President of the country signs the bill, it will be enacted into law. 

Meanwhile, Valdis Dombrovskis, former president of Latvia and nominee for the next Finance Commissioner of the European Union (EU), said last month that he would propose a unified cryptocurrency regulatory framework to regulate cryptocurrency activities among EU members.