Revised Bill ‘On Virtual Assets’ Aims to Regulate Ukraine’s Crypto Space This Summer – Regulation Bitcoin News

The Ukrainian parliament has released an updated version of the draft law “On virtual assets”. The revised bill requires exchanges for government authorization, disclosure of ownership, and enforcement of mandatory KYC procedures. The document has been criticized by regulators in Kiev, but the government wants the legislation passed before parliament’s summer break.

The bill proposes regulations for cryptocurrencies in Ukraine

Ukrainian lawmakers have revised a draft law designed to regulate the country’s expanding encryption space. MEPs have introduced a number of amendments since December, when they were voted on at first reading in the Verkhovna Rada, the Ukrainian parliament. The latest version of the document was was released this week by the parliamentary committee on digital transformation, which recommended its approval.

The account recognizes a virtual asset as “intangible goodThat has value and is “the object of political circulation”, Forklog mentionted. Fictitious assets can “certify property rights or non-property rights”, including “rights to claim other civil rights objects”, detailed publication. The draft also distinguishes between financial instruments and fictitious assets backed by currencies.

One of the basic regulations concerns exchanges and cryptocurrency exchangers. To operate legally, they must be authorized by the Ministry of Digital Transformation. Crypto service providers will be required to disclose their ownership structure and monitor financial transactions to prevent money laundering. The licenses will be valid for a period of one year. Russian platforms will not be allowed to operate in Ukraine.

Another important aspect is the introduction of mandatory recognition and verification procedures. As part of the Customer Acquaintance (KYC) process, individuals should provide IDs, bank accounts and information about their e-wallets. Companies should also share their business registration numbers. Trading platforms that do not currently perform customer verifications will need to update their boarding procedures to comply with the law.

The revised bill “Fictitious Assets” draws criticism from the Ukrainian regulatory authorities

The authors of the new legislation instructed the Ministry of Digital Transformation, the National Securities and Exchange Commission (NSSMC) and the National Bank of Ukraine (NBU) to oversee the implementation of the law. Representatives of the NSSMC and the NBU criticized the plan and demanded further revisions in correspondence with the chairman of the Verkhovna Rada, Dmytro Razumkov.

The central bank noted that the “On Virtual Assets” account is full of “significant gaps and conceptual errors” that could create legal uncertainty. At the same time, the Securities and Exchange Commission complained that the law does not clearly define the responsibilities of each regulatory authority and does not have mechanisms for coordinating market regulatory activities.

The NSSMC also insisted that the fictitious asset classification and regulatory approach adopted was not in line with international best practice and EU law. The agency is concerned about the lack of texts on investor protection and crime prevention. The NBU added that while fictitious assets are not recognized as legal tender in Ukraine, the law does not explicitly prohibit the exchange of goods and services and does not restrict transactions in other fictitious assets or fiat national currency in any way. The bank fears that this could lead to the emergence of a parallel settlement system beyond its control. The Rada Legal Service requested further amendments to the plan.

Undersecretary of Digital Transformation Alexandros Borniakov acknowledged that the ministry was facing criticism from various government agencies, which considered the bill “insufficiently perfect”. However, he noted that the need to protect the interests of the state is often seen as a need to impose additional restrictions and complicate the business environment. Bornyakov stressed that the interests of the participants in the encryption market would be the main priority of his ministry and promised that his team would make every effort to ensure that the bill reaches the floor of the Rada in the last week of plenary session. July 13.

In recent years, Ukraine has emerged as a generally encryption-friendly destination. The country ranked first among more than 150 nations in last year’s edition of the Global Crypto Adoption Index by forensic firm blockchain Chainalysis.

What is your opinion on the proposed legislation on encryption in Ukraine? Share your thoughts on the topic in the comments section below.

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