The Ukrainian parliament has passed a new law legalizing and regulating cryptocurrency and other virtual assets such as tokens. On Wednesday, the measure was passed by a near-unanimous vote and now awaits President Volodymyr Zelensky’s signature.
Following El Salvador’s decision to make Bitcoin legal cash, Ukraine has become the sixth country in as many weeks to establish ground rules for digital currencies. Ukraine, on the other hand, has not gone as far as El Salvador, which accepts Bitcoin as a legal tender alongside US dollars.
The law will control “legal relations developing in connection with the turnover of virtual assets in Ukraine, establishes the rights and obligations of participants in the virtual assets market, and the principles of state policy in the virtual assets field,” according to the Ukrainian draft bill.
Simply put, the law will safeguard virtual asset and exchange platform owners against fraud. Cryptocurrencies have long existed in a gray area in Ukraine, where they are neither legal nor illegal due to a lack of legislation that define them and their use.
While buying and exchanging cryptos was permitted, local courts were unable to protect citizens in the event of fraud or other mishaps. Authorities have traditionally seen digital currencies and cryptos as a “scam,” according to the Kyiv Post newspaper, and have raided crypto-related firms and even confiscated equipment “without any reasons.”
The draft law could potentially influence how Ukraine regulates cryptocurrency in the future. According to a representative for the Ministry of Digital Transformation, the country wants to open the cryptocurrency market to businesses and investors by 2022.
Mykhailo Fedorov, Ukraine’s Minister of Digital Transformation, recently stated that the government is modernizing its payment market in order for the National Bank to issue digital money.
Increasingly, countries are attempting to regulate cryptocurrencies. Aside from Ukraine and El Salvador, Cuba and Germany have achieved significant progress. Panama is drafting a draft law to regulate cryptos, thus it could be the next jurisdiction to do so.