In early September, Ukraine’s parliament took an important step that could reshape the country’s economic future. Deputies supported the first reading of Bill No. 10225-d “On Amendments to the Tax Code of Ukraine and Certain Other Legislative Laws on the Regulation of the Distribution of Virtual Assets in Ukraine”.
The move opens the door to new opportunities for the cryptocurrency industry after years of uncertainty and seeks to strike a balance between business freedom and the need for government oversight. Ukraine is now close to full legalization of the market, but why is it so important?
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Regulation as a driver of economic growth
Legalization of cryptocurrencies opens a window of economic opportunity for Ukraine. Countries such as Switzerland, Lithuania, Estonia and Portugal that have successfully created well-regulated markets can demonstrate how a well-structured cryptocurrency industry can become an attractive platform for global investment. Thanks to positive experiences, these countries have transformed into modern hubs of finance, technological innovation and even venture capital.
I am convinced that Ukraine has a real chance to create an economic miracle. The game’s clear rules and business-friendly approach could win back the capital of Ukrainian cryptocurrency enthusiasts, who currently work mainly abroad. It is also an opportunity to attract foreign investment, revitalize the economy, and strongly promote the modernization of financial markets.
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Sensible regulation can help create a supportive environment for blockchain startups and foster innovation. Asset tokenization, smart contracts, digital financial services, all of this will become more accessible and easier to understand.
At the same time, states will be able to capture additional tax revenue that can be channeled to rebuilding the country and developing infrastructure.
Most importantly, we have the opportunity to build an efficient cryptocurrency market with high standards, transparency and a win-win approach for all stakeholders, from governments to exchanges, investors and everyday users. And this is an opportunity you can’t afford to miss.
amendments to the bill
Bill No. 10225-d already includes several provisions that the industry has been waiting for. In particular, this document allows non-resident companies of trusted jurisdictions to legally operate in Ukraine, taking into account the international situation.
However, there is an important point. In order for the domestic crypto industry to attract not only foreign players, but also companies with a truly Ukrainian face, preferential treatment should be created specifically for companies with Ukrainian roots and Ukrainian beneficiaries. These companies are already serving local users and have earned their trust. They have built a reliable infrastructure, are EU licensed and operate under MiCA regulations. That is why bringing them back to Ukraine should be a priority. Supporting local businesses will also strengthen them and make a valuable contribution to the development and stability of the national economy.
Another notable proposal is to recognize certain assets issued abroad as equivalent to those in Ukraine. This helps our business remain part of the global market without losing its position. At the same time, it is important to monitor tokens originating from aggressor countries that seek to enter the market through intermediaries in the EU and other countries.
Future challenges
This bill requires further refinement, and there is still much debate ahead. One of the key issues is determining the regulator for the cryptocurrency market. Obviously, this must be an organization that is able to take advantage of the latest technology and has sufficient flexibility in decision-making. When building the market, regulators should follow both global best practices and Ukraine’s national interests.
The tax conditions of market participants also require special attention. Global experience shows that setting higher tax rates does not necessarily lead to higher incomes. When taxes become too heavy, companies may begin to consider more stable and favorable jurisdictions from a tax policy perspective. The result will be a loss for the nation. Also, without the presence of major players, it is difficult to expect large-scale investments, long-term liquidity and infrastructure development.
That is why a balanced tax approach is essential if we want to build a truly strong market in Ukraine. The optimal proposal would be to introduce a two-year concession period with a favorable tax rate (for example around 5%) on income from crypto assets. This should apply to all market participants, including both companies and individuals.
Today, Ukraine has a real chance to become the crypto capital of Europe.
Another separate issue that needs improvement is the use of virtual assets as a means of payment. While it may not be intended to compete with national currencies, it can be an important tool in business operations. It is also worth considering allowing certain assets, particularly stablecoins, to be used in corporate relationships, for example as contributions to a company’s charter capital.
And another issue that must not be postponed without compromise is the ban on market access for companies with ties to the aggressor country. Ukraine’s market must be protected from any attempts to bring in operators who served the citizens of the invaded country during the war. No matter how attractive an investment may seem, all doors and opportunities must remain closed for such companies.
Finally, I would like to emphasize that in adopting the virtual assets regulation bill, Ukraine should not simply copy Europe’s MiCA regulation. In particular, Ukraine does not yet meet EU requirements in areas such as banking, anti-money laundering, anti-terrorism and anti-corruption, so it would be a mistake to transplant these standards into European institutions without fully integrating them. Indeed, the principles and values of MiCA should form the basis of the new law, but always adapted to the realities of Ukraine and the fact that we are still on the road to the EU.
Why is dialogue between markets and states important?
The most important thing now is for states to legislate and listen to businesses. Dialogue with the market, especially with companies with international experience, is key to creating effective regulation. A working group has already been established within the Diia.City.United business community to submit proposals for this bill. We invite forward-thinking companies who care about the future of our country to join this initiative.
Today, Ukraine has a real chance to become the crypto capital of Europe. And this is not just rhetoric, but a concrete prospect that can be realized through the right decisions. Achieving that requires transparent rules, room for innovation, and a level playing field for all market participants. Seizing this opportunity will attract investment and demonstrate that Ukraine is actively seeking a path to a better economic future.
The views expressed in this opinion article are those of the author and not necessarily those of the Kyiv Post.
