Bogdana Yefremova
Group Prime Services | Head of GPS Ukraine
Market Update Ukraine: on the Verge of Cryptocurrency Legalization
The Ukrainian Parliament is set to review a bill to legalize cryptocurrency, aligning with European MiCA standards. This move aims to create a transparent virtual asset market, boost state revenues, and protect investors. With many Ukrainians already using cryptocurrency for daily transactions, the new law will provide legal clarity for businesses and integrate virtual transactions into financial reports. Expected to pass by year-end, the bill could generate substantial budget revenues and position Ukraine as a regulated hub in the global crypto market.
The Parliament of Ukraine is preparing to consider a bill to legalize cryptocurrency, based on the European MiCA standards. This document aims to create a transparent market for virtual assets in Ukraine. Lawmakers expect that the launch of the virtual assets market will allow the state to receive additional budget revenues and protect investors.
Currently, many Ukrainians are engaged in cryptocurrency for everyday purposes like savings, making donations, and sending remittances back home. At the same time, legal entities do not have the opportunity to work in this field due to the lack of regulation. The new law will establish clear rules of the game for businesses, and virtual transactions will be able to be officially reflected in financial reports.
The bill is developed based on MiCA, a European regulatory act that governs virtual assets and protects investors. All regulations have been adapted to Ukrainian realities to ensure the effective functioning of the market.
The first reading of the draft law on the legalization of cryptocurrency should take place in the first quarter, with full adoption planned by the end of the year. The Parliament already attempted to legalize the cryptocurrency market in 2021, but the law did not come into force due to tax uncertainties.
Ukraine is among the countries with the largest volumes of cryptocurrency transactions. Specifically, Ukraine occupies no. 6 in the 2024 Global Crypto Adoption Index. However, this market remains unregulated.
Ukrainian blockchain and cryptocurrency specialists are founding exchanges abroad, operating in a legal framework and paying taxes in other jurisdictions. At the same time, many companies are waiting for legislation to be passed in Ukraine to officially register and pay taxes at home.
According to estimates by the Ministry of Digital Transformation, potential budget revenues from the cryptocurrency sector could amount to about 22 billion UAH per year, which would be an important source of funding in conditions of budget deficit.