Ukraine’s Ministry of Digital Transformation has now recently published a crypto draft law, aptly named “on Virtual Assets.” This comes as a response from the Financial Action Task Force, or FATF mandating a deadline of June of 2020.
Legalizing Crypto Within Ukraine
On the 18th of May, the Ministry of Digital Transformation of Ukraine had published a new draft bill, dubbed “On Virtual Assets.” This bill is set to determine the legal status of cryptocurrencies within the country, as well as regulate their issuance and circulation within it. As it stands now, the current version of the bill isn’t its final form and will be open for discussion for Ukraine’s crypto community until the 5th of June, 2020.
According to the draft bill’s co-authors, the main goal of this action is to allow local crypto firms, such as cryptocurrency exchanges, to open up bank accounts. Micheal Chobanion stands as the Bitcoin Association Ukraine’s president and had the organization co-author the bill with the aid of industry players, law firms, and state authorities.
As it stands now, Ukraine’s laws prohibit crypto firms as a whole from opening bank accounts within their own country, which is immeasurably bad for business.
Stepping Out of The Grey Zone
This draft bill aims to change all that, moving the crypto industry as a whole outside of the so-called “grey zone” of legislation. Once the legal presence of crypto is established within the country, Ukraine itself will be capable of further expanding on its success within the crypto industry.
The bill itself allows for virtual asset service providers, which are issuers, users, as well as crypto exchanges, to have the right to open accounts within banking, as well as other financial institutions.
Several Concerns Raised
However, it should be noted that not everything’s sunshine and roses. Unlocking the various benefits that the crypto industry can gain within Ukraine costs money, just like anything else. Andriy Khaavryuchenko, the founder of the DevNull.AI software firm, gave a public tweet regarding the new bill from Ukraine. According to Khavryuchenko, the bill will stand to make all Bitcoin wallets within Ukraine illegal, unless it was registered with the Ministry, first.
— akhavr (@akhavr) May 19, 2020
The draft law will mandate local firms to register in order to operate a fiat-to-crypto business within Ukraine legally. Should one do it without registration, you’re breaking the law under this new bill. These firms will be further mandated to adhere to strict Know Your Customer (KYC) and Anti-Money Laundering (AML) laws.