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Ukraine Seeks To Legalize Cryptos In Three Years

Ukraine has unveiled a plan that seeks to establish a mechanism for cryptocurrencies..


 

Ukraine Unveils Policy Framework For Cryptocurrencies

Ukraine is working towards legalizing cryptocurrencies. According to a statement from the government, relevant bodies are working on a plan to come up with legal frameworks that will support the legalization.

A new policy has been unveiled by the Trade Ministry as a means of identifying the cryptocurrency sector as a new form of technology. The new government-backed policy is meant to provide an oversight on cryptocurrency related activities. The policy will be implemented within the next two years.

The regulatory system will first focus on the local market. The state is pushing for strict adherence to KYC and anti-money laundering laws. The implementation is currently ongoing and it is expected to run throughout next year.

In the next two years, the state will start monitoring the mining sector, smart contracts and taxation as the second phase of its plan. Additionally, authorities will seek to classify cryptocurrencies as an asset class sector.

According to Denis Zarytsky, a researcher, the government document's proposal on taxation offers a lower rate compared to other regions like France. The document states that crypto holdings will be subjected to a 5% taxation. A country like France charges 10% on all holdings.

Countries like Japan have categorized cryptos as properties, in return imposing high taxes. However, Japan removed the double taxation policy on digital assets.

Zarytsky said that the initiative undertaken by Ukraine is an ongoing process.

The guideline comes just a few days after a member of Parliament in Ukraine urged the government to eliminate taxes on cryptocurrencies by the year 2020. The legislator, Yuriy Derevyanko stated that the sector has the potential of playing a major role in the economy of Ukraine and taxation might derail the sector. He is vocal in pushing for a rollout of regulations in the sector which might drive the country’s economy to the next level.

In Ukraine, we have a team supporting and opposing the cryptocurrency sector. However, both parties hold the view that in the long term, the sector has a lot of potential.  If the optimistic view holds true, the country might legalize cryptos in three years time.

If the legalization goes through, Ukraine will join global powers like South Korea, France and Japan in setting up structures for the smooth operation of cryptos. However, some parties argue that the three year period is too long.

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