Is It Possible to Regulate Cryptocurrency in Ukraine?

Published on 20 Feb. 2018
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Law project “On stimulation of the cryptocurrency and derivatives market in Ukraine,” that was introduced in Verkhovna Rada in October 2017, received a whole list of critical comments from experts, but the deputy Serhii Rybalka who had offered the project, continued to defend his law.

The issue of regulating cryptocurrency industry has been on everyone’s lips recently. The international community is buzzing with announcements and suggestions of the world leaders, who seem to come to the conclusion that regulation is needed not only on the local but global level generally.

The Ukrainian government is regrettably trailing far behind since the majority of the countries – of Europe, Asia, America – has at least partial legislation that defines the status of cryptocurrencies.

There are several projects, stocked in Verkhovna Rada, but experts who were examining them have provided negative feedbacks to all of them. Recently, a representative of the Central Bank of Ukraine, the head of the department of open market projects Emal Bakhtari suggested creating a workgroup for development of the new law project on cryptocurrency and mining regulation, together with regulators and market members. In his opinion, the existing projects are incomplete, and one has to create an entirely new document.

Also, experts say that the project “On stimulation of cryptocurrency and derivatives market in Ukraine” has many inconsistencies. The president of the Ukrainian analytic center Oleksandr Okhrimenko states that Ukrainian legislation already has a notion of “cryptocurrency” for over ten years. He considers the project of Serhii Rybalka as a “fashionable feature”:

Rybalka suggests that NBU develops normative acts. Excellent. I agree. But NBU had already developed them ten years ago! Our problem is the ideas of our deputies who don’t want to study out the question and just follow the “fashionable feature.”

As for the financier Andrii Blinov, he says that the mentioned project raises numerous questions impossible to answer. Blinov believes that the document has to be supported by the financial government of Ukraine. If there is no support, random collisions will emerge that will be hard to solve.

Vadym Braiilovskii, CEO of the investment banking company European Capital Management, has joined critics by accusing Rybalka of political populism.

The thing is, Bitcoin is not monetized at the moment. National banks of Germany, Switzerland, and Great Britain that support the whole financial system of Europe are critical about cryptocurrency. And every country treats these notions its way. It is hard to understand what interests people’s deputy Rybalka pursues. I don’t see the mechanisms of the direct material profit. It’s most likely just political populism, the aim of which is distracting attention from the criminal cases, opened against Rybalka on the facts of state treason and undermining of economic security of Ukraine,

 – says Braiilovskii.

But none of the accusations stop Serhii Rybalka. He writes on his  Facebook page: 

At the finance committee meeting on February 8, 2017, we’ve agreed to create one single project on the basis of the two present drafts to accelerate the review of this question in the session hall. I will be insisting on that.

Will the deputy’s persistence help him to defend his deficient project? It’s quite likely since not only cryptocurrency owners talk, call, demand the regulation but Ukrainian cyberpolice as well. Right now, these are just talks, and only time will show how much more cryptocurrency community has to wait for reasonable and profound legislation. 

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