Ukraine is set to fully legalize cryptocurrency by mid-2025, marking a significant step toward integrating digital assets into the national economy. According to Danylo Hetmantsev, Chairman of the Verkhovna Rada’s Finance, Tax, and Customs Policy Committee, the legislative framework is largely complete, with only taxation and regulatory oversight matters still under discussion.
The legalization effort comes as Ukraine seeks to align its policies with European standards and create a transparent market for virtual assets. The bill, which is modeled after the European Union’s Markets in Crypto-Assets (MiCA) regulation, aims to provide clarity for businesses and investors operating in the country’s growing crypto sector. If approved, it would remove existing legal uncertainties and bring digital assets under formal financial regulation.
Regulatory Challenges and Institutional Oversight
A central issue in the legislative process has been determining which institution will oversee cryptocurrency regulation. Initially, the National Securities and Stock Market Commission (NSSMC) was expected to take on this responsibility. However, Hetmantsev has expressed concerns over the commission’s institutional capacity, suggesting that the National Bank of Ukraine (NBU) may be better suited to handle regulation—at least in the initial stages.
The draft legislation, which is expected to be considered by the Verkhovna Rada in early 2025, also includes provisions for financial monitoring of crypto transactions. Lawmakers are working to define how enforcement agencies will implement oversight mechanisms to ensure compliance with anti-money laundering (AML) and counter-terrorism financing (CTF) measures.
Taxation Policy and Business Impact
Taxation remains another key focus of ongoing discussions. Unlike some jurisdictions that provide tax incentives for crypto-related activities, Ukraine intends to tax cryptocurrency investments under the same rules applied to traditional financial assets. This approach, Hetmantsev argues, ensures a level playing field between digital asset investors and those engaged in conventional markets.
However, a potential complication arises for investors who cannot verify the original acquisition of their cryptocurrency holdings. Under the proposed framework, these individuals may be taxed on the full value of their assets rather than just their capital gains. This aspect of the legislation has drawn scrutiny from industry participants who fear it may discourage investment and innovation in Ukraine’s crypto sector.
Ruslan Magomedov, head of the NSSMC, has emphasized that the bill is designed to create a stable and predictable environment for businesses and individual traders. “Legalization will help Ukraine build a new industry that contributes to the state budget while protecting investors and establishing transparent rules for businesses,” Magomedov said in a statement.
