Ukraine Now Trades Crypto More Than Fiat

February 18, 2022 3:58 pm

Ukraine has announced the passing of a new bill which essentially legalizes all cryptocurrency and has prepared a new foundational legal framework that will help regulate digital assets like Bitcoin.

The Prime Minister of Ukraine, Mykhailo Fedorov, announced on Twitter that this move will help the nation and its citizens to protect their assets from being abused or from fraud.

This was the country’s first success at passing such a law as the previous attempt to pass this bill was vetoed by President Volodymyr Zelenskyy which shows that this is a new milestone that the country has finally reached.

Concerns in the past surrounding crypto were about whether Ukraine has the resources to be able to regulate digital assets in the first place.

Now that the bill has passed, regulatory oversight will be managed by the the National Commission on Securities and Stock Market.

Fortune.com reports:

The new version of the law on virtual assets, which passed parliament Thursday, puts crypto regulation under the oversight of the National Commission on Securities and Stock Market, per Zelenskyy’s suggestion.

Notably, the bill does not recognize Bitcoin or other cryptocurrencies as legal tender. Ukraine has not gone the route of El Salvador, which adopted Bitcoin as an official currency in September last year. But the new law will provide reassurance to businesses operating in what was previously a legal gray area.

“Market participants will receive legal protection and the opportunity to make decisions based on open consultations with government agencies,” Fedorov said in an official statement.

Despite the previous lack of formal regulation, Ukraine has already developed itself as Europe’s leading hub for crypto industries.

Market consultancy Chainalysis ranked Ukraine fourth globally behind Vietnam, India, and Pakistan in its 2021 Global Crypto Adoption Index, which measures the volume and value of crypto traded in a country.

The New York Times has reported that the country actually now processes more crypto transactions than fiat now indicating that the citizens of the country are very tolerant in embracing blockchain technology.

With the new law in place, the government is hoping that this will help attract foreign investment that could help boost the country’s economy, especially from other countries and institutions that are crypto friendly.

The government mentioned that they believe that this is the best course of action rather than a ban which will prevent the country from missing out on the vast potential economic benefits that crypto could bring.

TechStory reports:

In January, Ukraine’s Deputy Minister of Digital Transformation Oleksandr Bornyakov told Fortune, “Our supportive approach on crypto certainly stands in contrast with neighbors whose politicians propose a ban on the usage and mining of cryptocurrencies.

I’d want to remind them that crypto regulation, rather than a prohibition, will be more effective.”

Although the country has not made a digital asset such as Bitcoin as legal tender yet in the same way that El Salvador has, investors expect that this will continue to encourage other countries that are currently on the fence to jump into crypto to take advantage of the technological and economic benefits.

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