Ukraine plans to recognize cryptocurrencies as a financial asset

The Verkhovna Rada of Ukraine is developing a bill defining cryptocurrency as a financial asset. The authorities may adopt the document before the end of this year or at the beginning of next year.

Like other European countries such as Malta, Gibraltar and Switzerland, Ukraine plans to quickly regulate digital assets, adopting the same legal mechanisms in determining the status of crypto assets.

While Ukraine's approach may seem surprising given that other countries are mixed on the issue, the country is not the first to compare digital assets to stocks. Initial coin offerings (ICOs), which offer coins instead of selling shares, are considered securities transactions in almost all countries, which is not the case with cryptocurrencies such as Bitcoin or Ethereum.

National regulators have finally considered the issue on its merits and decided on the status of cryptocurrency. According to the head of the National Commission for Securities and Stock Market (NCSM) Timur Khromaev, cryptocurrency will be recognized as a financial instrument. The bill will consider cryptocurrency not as a means of payment, but as an instrument of accumulation of funds, like shares and bills. 

Timur Khromaev believes that first of all, it is necessary to determine the principles that will help ensure the development of the cryptocurrency sector in the country. Ahead lies the creation of favorable economic and legal conditions for the development of the crypto industry, the introduction of taxation, supervisory functions, etc.

For the first time, Ukraine announced its plans to issue regulation of crypto assets back in 2015. The original idea was to regulate cryptocurrency trading and ICO campaigns. At that time, Khromayev spoke about issuing licenses to individuals involved in digital currencies and mandatory disclosure of information. However, for now, Ukraine's attention appears to have shifted to another target. It is obvious regulators' intention to firmly take control of the cryptocurrency market and financial flows for taxation.

Despite the fact that at the end of 2017, there were three bills in the Verkhovna Rada of Ukraine that relate to the cryptocurrency market, the situation has not changed to this day. 

In recent years, statements have been made repeatedly about the need to legalization of the crypto-asset market, but no concrete actions have been taken.. Meanwhile, the popularity of cryptocurrency among the population is growing. The daily volume of transactions with crypto assets in the country has reached $2 million. Almost 13% of Ukrainians already own one or another cryptocurrency.