Ukraine will allow cryptocurrency companies to work with banks

Ukraine is approaching providing legal status to cryptocurrencies such as Bitcoin (BTC), as evidenced by a new bill published this Monday.

May 18 Ministry of Digital TransformationUkraine has published a new bill on virtual assets, the purpose of which is to determine the legal status of crypto assets, the rules for their circulation and release in the country. The current version of the bill is not final and is open for discussion by the crypto community until June 5, 2020.

According to one of the co-authors of the newof the bill, the main purpose of this initiative is, finally, to enable local cryptocurrency companies, for example, cryptocurrency exchanges, to open bank accounts. President of the Bitcoin Association of Ukraine Mikhail Chobanyan, who is the co-author of the new bill along with government agencies, law firms and industry players, emphasizes that crypto exchanges still cannot open a bank account in Ukraine.

Thus, the proposed bill is intended toremove the crypto industry from the “gray zone” and, finally, ensure the legal presence of companies in Ukraine. According to the bill, virtual asset service providers - crypto-exchanges, issuers and users, "have the right to open accounts in banking and other financial institutions."

However, obtaining sufficient benefits forThe crypto industry in Ukraine has its costs. The founder of DevNull.AI software developer company, Andrey Khavryuchenko, tweeted that Ukraine’s bill on Virtual Assets would make all cryptocurrencies illegal if they were not registered with the ministry.

According to the bill, local companies are required toregister in order to legally manage the crypto business, otherwise this activity will be illegal. Firms will also need to ensure compliance with anti-money laundering, AML and KYC requirements.

According to Chobanyan, the new bill was created inresponse to the requirements of the FATF (Financial Action Task Force). Last year, it was announced that the AML cryptocurrency guidelines would be taken into account by June 2020.

Ukraine is considering a law on regulationcrypto assets for at least four years. The first reports on cryptocurrency in the country appeared at the end of 2015, when the Verkhovna Rada of Ukraine announced plans to determine the legal status of bitcoin by January 2016. So far, none of the existing initiatives in the field of cryptocurrency legislation has been adopted.

Now local authorities are at least working onthree separate bills, including on the taxation of cryptocurrencies. At the end of 2019, the Ministry of Digital Transformation of Ukraine entered into a partnership agreement with the world's largest cryptocurrency exchange Binance for cooperation in the field of local cryptocurrency legislation. According to Chobanyan, Binance did not participate in the development of the bill on virtual assets, but should give feedback on the proposed law.

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