Following the increasing usage of cryptocurrencies in the country, Ukraine has decided to start considering regulations for these digital assets and their trading within its territory.
In an official meeting that was held between multiple government institutions, Oleksandr Turchynov, Secretary of the National Security and Defense Council, directed the institutions to start developing “legal proposals” in order to start regulating the issue of cryptocurrency trading.
The council essentially formed a “working group” of various authorities to look into the requirements of effective regulatory practices, including but not limited to the following.
- Establishing a proper regulatory authority within the country along with defining its hierarchy within the government.
- Identifying the individuals and corporations that take part in cryptocurrency transactions to eliminate anonymity,
- Suggesting ways to monitor cryptocurrency transactions.
- Implementation of tax on cryptocurrency transactions.
The move comes in the midst of growing concerns from various institutions of the country that refer to the lack of taxation, the anonymity of transactions, and the non-existence of any regulations over the cryptocurrency exchanges present within the country.
The financial institutions had their concerns on taxes and how the cryptocurrency trading needs to be regulated for best practices. A bill had been drafted and presented to the Verkhovna Rada, Ukraine’s parliament, to have cryptocurrency trading regulated by the central bank. However, even though the bill was introduced back in October 2017, it remains to be discussed and passed.
The institutions pointed out how the anonymity of these transactions could help in money laundering by providing easy access to legalizing assets that come from criminal activities.
They also stated that the usage of anonymous transactions does not end there, but the cryptocurrency trading could also be used in trading contraband such as firearms and drugs, which could pose a massive threat to Ukraine.
It was further mentioned how all of these activities could particularly come in handy for terrorist activities originating from the “occupied territories of Ukraine.”
Will Ukraine be as severe as China and South Korea?
Except for a couple of incidents in the past that related to the investigation by the Security Service of Ukraine, the country has so far been ambivalent to cryptocurrency trading. It does not seem that it will follow the same approach as China in cracking down on the cryptocurrency industry, but it is certain that regulatory measures will be taken by the government shortly.
What those regulatory measures will propose is a different matter of discussion altogether. However, the cryptocurrency community in Ukraine expressed their hopes that the country will let them operate their businesses and day to day operations without unnecessary regulations. As with most entities associated with cryptocurrencies, the ones in Ukraine are also willing to abide by regulations as long as they do not get to hinder their justified operations.