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Ukraine’s Draft Crypto Bill Passes First Parliamentary Hearing

The first effort involving Ukraine's legislative cryptocurrency regulation has had a successful hearing in the national parliament - the Verkhovna Rada.

After being considered and given the initial thumbs-up by lawmakers Wednesday, the Draft Bill on Virtual Assets now has two more hearings before it can become law.

If that happens, Ukraine will join the still-short list of nations that have put in place dedicated laws regulating cryptocurrencies. The country was named a global leader in crypto adoption by blockchain analytics firm Chainalysis in September when citizens were actively using crypto for savings, investment, and cross-border trade.

Things were not entirely smooth for the bill during the parliamentary hearing: Some legislators decried wasting time on virtual assets when there are more important issues plaguing the Ukrainian economy. However, in the end, the bill received 229 “yes” votes out of 340 and passed this first stage of the legislative process.

The bill outlines virtual assets as “a set of data in electronic form,” which “can be an independent object of civil transactions, as well as certify property or non-property rights.” The law suggests not considering virtual assets as legal tender in Ukraine.

The document singles out virtual assets backed by goods or services, suggesting they must be taken out of the market in cases where the backing ceases to exist.

The ownership of virtual assets is considered as being the entity holding the private keys unless they are held with a custodian, forfeited by the court decision, or acquired illegally.

Virtual assets would be regulated by Ukraine’s Ministry of the Digital Transformation, and crypto service providers must register to be able to operate in the nation. Firms must provide information on ownership structure and beneficiaries, as well as ensure they don’t facilitate money laundering and are diligently protecting users’ personal data.

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