Ukraine’s current administration is in favor of legalizing cryptocurrencies as part of the modernization of the country. Although digital currencies do not have official status, they are not illegal as well. As more and more nations in different parts of the world are accepting these currencies, Ukraine is showing interest in keeping pace with them.

A high-level official from the Ministry of Digital Transformation confirms that legalizing cryptocurrencies is being considered seriously at this moment. Alexander Bornyakova, a to-be deputy minister revealed that individuals involved in crypto trading should step out from the “grey zone” and start paying taxes. He announced the plan of Digital Transformation Minister Mikhail Federov to legalize cryptocurrency at a presentation of the state brand in the smartphone.

Despite noticeable cryptocurrency activities in the country, the government is not getting any taxes due to a lack of official recognition of those currencies. If the government’s plan to legalize cryptocurrency is implemented, any gains on digital currency would be a taxable event. In that case, crypto-related activities will contribute to the nation’s GDP and hence have a positive impact on the economy.

Alexander pointed out the government’s intention to earn on cryptocurrency mining. He spoke in the same tone as the official from the Ministry of Digital Transformation that the state may allow cryptocurrencies trading and use DLT for public registries. Mikhail Federov, the deputy prime minister, stated that they want to make government services much more convenient for the citizens. He believes that all services should be easy, fast, and efficient like ordering Uber or Airbnb.

New President is showing crypto-friendly attitude

Ukraine had its new, young, and promising president in April 2019. Volodymyr Zelensky is an actor, comedian, film director and he seems to be an inexperienced person to lead a country. But his commitment to eradicating corruption helped him win the election. He intends to modernize Ukraine through technology, and he has already taken initiatives to increase digital literacy.

His vision is to make Ukraine a better nation and adopting cryptocurrency is part of his dream of digitalization. The previous government started a study on digital assets and planned to develop a crypto policy by 2021. However, the new President wants to accelerate the process to make the country crypto-friendly very soon.

Previous government could do little about crypto legalization

The previous government’s initiative to legalize cryptocurrency would take three years. The plan to regulate the fintech sector as part of a new public policy was developed in 2018 by the ministry of finance. The ultimate objective was to make the industry built around digital assets a legitimate part of the county’s economy. The initial part of the two-stage regulatory concept was to determine the legal status of cryptocurrencies, and other platforms dealing with digital assets.

Next, the government would analyze market trends and outstanding issues to come up with proposals to regulate the sector. The second phase was supposed to be implemented in 2020-2021 which involves recognizing cryptocurrency wallet providers and custodial platforms. The status is equivalent to that given to traditional financial organizations like commercial banks.

Ukrainian lawmakers were expected to craft and adopt legislation on initial coin offerings (ICOs), tokens and the use of smart contracts. A number of bills have been submitted in the parliament since last year but the progress seems to be negligible. The economy ministry gave hope to the cryptocurrency companies that the implementation of regulatory plans would allow them to gain access to banking services.

Local experts believe that the regulation of the cryptocurrency sector will attract foreign investments and stimulate the development of the digital economy. Cryptocurrency enthusiasts can surely see new hope as the new government’s activity indicates.