As a researcher with a background in both economics and technology, I find Ukraine’s gradual embrace of cryptocurrency to be a fascinating development. Having closely followed the country’s digital transformation journey, it is evident that Ukraine is not just jumping on the bandwagon but rather strategically positioning itself for the future.
In simple terms, it appears that Ukraine is stepping forward towards making cryptocurrencies legal, as a fresh bill is anticipated to be concluded in the initial part of 2025.
Danylo Hetmantsev, who leads the Ukrainian Parliament’s committee overseeing Finance, Tax, and Customs Policy, stated that the bill is almost set for its initial discussion, as reported by Pravda.
According to Hetmantsev, the law is being created through a joint effort with the National Bank of Ukraine and the International Monetary Fund.
The new law aims to control and tax transactions involving cryptocurrencies, using a system comparable to that of securities. Profits earned from crypto assets will be subject to taxation only when they are exchanged for conventional currency. Hetmantsev highlighted that Ukraine is taking a prudent stance on tax breaks for cryptocurrencies, due to fears about potential tax evasion in traditional markets.
The government has avoided including tax exemptions in the draft to prevent misuse, with consultations involving European experts and the IMF helping shape the cautious stance.
The taxation for cryptocurrency transactions will be similar to how we handle taxes for security investments. This means that any profit you make won’t be taxed until your crypto assets are changed into traditional, or fiat, currencies.
Ukraine’s dance with crypto
Ukraine’s shift towards cryptocurrency legalization reflects its increasing curiosity in digital currencies. Already, the nation has implemented blockchain technology for certain government operations.
During the large-scale invasion initiated by Russia in Ukraine, Ukraine received numerous donations in cryptocurrency. These donations have been utilized for diverse humanitarian and military needs, demonstrating the benefits of fund transfer systems without borders or central control during emergencies.
In the last quarter of 2023, Ukraine adopted the FATF cryptocurrency regulations to ensure global conformity and prevent being placed on a grey list.
From my perspective as an analyst, I’m eagerly anticipating the initial reading of the cryptocurrency legislation in Ukraine post-New Year. The legal foundation for this digital currency is almost set, and I believe this upcoming step will bring us one step closer to a more comprehensive understanding and regulation of the cryptocurrency landscape in Ukraine.
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2024-12-12 18:43