Plans for legalization: Ukraine wants to become the center of cryptocurrency

The head of the Ministry of Digital Development, Mikhail Fedorov, based on impressive statistics on the circulation of cryptocurrency in the country, noted that there is no legal framework and law in Ukraine, and cryptocurrency is still not legalized, and this is a significant problem for the economy and the state as a whole.

The minister said that within the next month the law "On virtual assets" will be considered at the second reading and adopted, after which the purchase / sale of bitcoins, cryptocurrency mining and all other transactions with digital assets will become transparent.

Ukraine as a center of cryptocurrency

Ukraine is in a leading position in the world in terms of the number of use of digital assets. The sum of all transactions with crypto-currencies in the country is more than 150 million dollars daily.

The legalization of bitcoin in Ukraine will help attract a large number of people involved. This is because mining companies will be exempted from tax payments with the need to deduct only 5% of their own profits. With individuals and home mining, things are the same: the exclusion of VAT payments and with the deduction of 5% of income with a grace period until 2025. Bornyakov (Deputy Minister of Digital Transformation for the Development of the IT Sphere) emphasizes that these conditions will help to better develop the direction of cryptocurrency for the population and the state, and after the grace period, the possibility of returning to the standard rates of 18% will be considered.

At the moment, about a hundred companies in Ukraine operate in the field of cryptocurrencies. Statistics for the country over the past year show that during this period, more than $ 8 billion were withdrawn and entered into cryptocurrencies.

Mining at Ukrainian NPPs

• Zaporizhzhia NPP

Legal bitcoin mining in Ukraine will soon be possible near the Zaporizhzhia nuclear power plant - the largest in all of Europe.

As previously reported, the Ministry of Energy of Ukraine has proposed using excess nuclear electricity for mining. This project was presented back in 2020 by the Swiss company H2, which is ready to invest $700 million in the project.

• Rivne NPP

Another mining farm in Ukraine will be located near the Rivne NPP together with the Dutch company Bitfury.

Why NPP? The thing is that it is important for Ukrainian nuclear power plants to maintain the load, which has dropped significantly with the onset of the Covid-19 pandemic. That is why solutions in placement near nuclear power plants are ideal for mining farms.

Consequences of the adoption of the law "On virtual assets"

Ukraine is making a very bold bet by trying to transition to a high-tech economy. The adoption of the law "On virtual assets" will help Ukraine become one of the most attractive destinations in the cryptocurrency world. Also, Fedorov’s deputy notes, with the adoption of the draft law, the number of cryptocurrency companies will increase from one hundred to two thousand.

After the adoption of the law, Ukrainian banks will be able to open accounts in cryptocurrency, along with regular fiat money. However, it will not be possible to pay with bitcoin in Ukraine, the hryvnia will remain the only national means of payment in the state. Bornyakov draws an analogy with gold: it is impossible to buy coffee or travel for the precious metal, but at the same time, it can be kept in deposit accounts, converted into national currency so you can receive payments.

We can safely assume that the adoption of the law "On Virtual Assets" is another big and very bold step for Ukraine into the future. In conclusion, let us recall the words of Katarzyna Chupa, an analyst in the field of digital assets and Ph.D: 

“Cryptocurrency is the technology of the future, which will not disappear, but will remain forever.”