December 13, 2024
According to Daniil Getmansev, head of the Ukrainian parliament’s tax committee, Ukraine is preparing to legalize cryptocurrencies by early 2025.
New legislation is currently under review. It aims to regulate digital assets while maintaining standard tax practices.
Ukraine's cryptocurrency regulator to tax crypto profits
According to local reports, the bill is being finalized in cooperation with the National Bank of Ukraine (NBU) and the International Monetary Fund (IMF). However, previous hopes for tax breaks have been rejected.
Instead, the new regulations in Ukraine will tax crypto profits converted to fiat currencies, according to rules similar to those for securities trading.
Also, a dedicated working group is working on advancing the bill, targeting its first parliamentary reading in the first quarter of 2025. The framework will oversee digital asset transactions and focus on financial stability and compliance with anti-money laundering (AML) standards.
“In consultation with European experts and the IMF, we are very cautious about using cryptocurrencies in tax incentives as an opportunity to evade taxes in traditional markets,” said Daniel Getmansev.
Amid the ongoing conflict with Russia, legalizing cryptocurrencies could provide Ukrainians with a secure financial tool. Digital assets could offer alternatives to cross-border transactions, protecting wealth during wartime and bypassing traditional banking systems disrupted by conflict.
Cryptocurrencies have already played a vital role in humanitarian aid, raising nearly $70 million in early 2023 to support defense and relief efforts in Ukraine.
The initiative is in line with global regulatory trends. Russia recently banned cryptocurrency mining in the occupied regions of Ukraine, including Donetsk and Luhansk.
Despite these moves, Russia has eased its domestic tax policies on cryptocurrencies. The new law exempts transactions from value-added tax (VAT) and sets the income tax rate on cryptocurrency profits at 15%.
Elsewhere, Morocco is drafting cryptocurrency regulations to replace its 2017 ban. Meanwhile, Argentina is considering allowing bitcoin payments by 2025 to boost currency freedom.
These developments highlight a growing global shift towards integrating cryptocurrencies into mainstream financial systems. The upcoming legislation in Ukraine marks a significant step towards creating a transparent and regulated environment for digital assets with an emphasis on financial accountability and financial stability.