Opinion: What’s Next for Ukraine’s Crypto Market After the New Law

At the start of September, Ukraine’s Parliament took an important step that could reshape the country’s economic future. Lawmakers backed the first reading of Bill No. 10225-d, “On Amendments to the Tax Code of Ukraine and Certain Other Legislative Acts on Regulating the Circulation of Virtual Assets in Ukraine.”

This move opens the door to new opportunities for the crypto industry after years of uncertainty and attempts to strike a balance between business freedom and the need for government oversight. Ukraine is now moving closer to fully legalizing the market – but why does that matter so much?

Regulation as a driver of economic growth

The legalization of cryptocurrencies opens a window of economic opportunities for Ukraine. Countries like Switzerland, Lithuania, Estonia, and Portugal – which have successfully built well-regulated markets – can show how a properly structured crypto industry can become an attractive platform for global investment. Thanks to their positive experiences, these countries have transformed into modern hubs for financial and technological innovation, as well as venture capital.

I’m convinced that Ukraine has a real chance at its own economic miracle. Clear rules of the game and a business-friendly approach could bring back the capital of Ukrainian crypto enthusiasts who are now mostly working abroad. It’s also a chance to attract foreign investment, reinvigorate the economy, and give a strong push toward modernizing financial markets.

Smart regulation would help create a supportive environment for blockchain startups and fuel innovation. Asset tokenization, smart contracts, and digital financial services – all of this would become more accessible and easier to understand.

At the same time, the state would gain additional tax revenues that could be directed toward rebuilding the country and developing infrastructure.

Most importantly, we now have the chance to build an efficient crypto market with high standards, transparency, and a win-win approach for all stakeholders – from the government to exchanges, investors, and everyday users. And this is an opportunity we cannot afford to miss.

Amendments in the draft law

Bill No. 10225-d already includes several provisions the industry has been waiting for. In particular, the document – taking the international context into account – allows non-resident companies from trusted jurisdictions to legally operate in Ukraine.

But there’s an important point: for the national crypto industry to bring together not only foreign players but also have a truly Ukrainian face, preferences should be created specifically for companies with Ukrainian roots and Ukrainian beneficiaries. These businesses are already serving local users and have earned their trust. They have built a reliable infrastructure, obtained EU licenses, and operate under the MiCA regulation. That’s why bringing them back to Ukraine should be a priority. Supporting homegrown companies would also strengthen local businesses and make a valuable contribution to the development and stability of the national economy.

Another notable proposal is to recognize certain assets issued abroad as equivalent to Ukrainian ones. This would help our businesses remain part of the global market without losing their positions. At the same time, it’s crucial to monitor tokens originating from the aggressor state, which may attempt to enter the market through intermediaries in the EU or other countries.

Challenges ahead

There are still many debates to come, as the bill needs further refinement. One of the key questions is determining the regulator of the crypto market. Clearly, this must be a body capable of working with modern technologies and flexible enough in its decision-making. In building the market, the regulator should be guided both by global best practices and by Ukraine’s national interests.

Tax conditions for market participants also require special attention. Global experience shows that setting high tax rates does not always lead to higher revenues. When taxes become too heavy, companies may start considering more stable and favorable jurisdictions in terms of tax policy. The result is losses for the state. And without the presence of major players, it’s hard to count on large-scale investments, long-term liquidity, and the development of infrastructure.

That’s why a balanced tax approach is essential if we want to build a truly strong market in Ukraine. The optimal proposal is to introduce a preferential two-year period with a favorable tax rate on income from virtual assets (for example, around 5%). This should apply to all market participants, both companies and individuals.

Another separate discussion point in need of refinement is the use of virtual assets as a means of payment. They may not be intended to compete with the national currency, but they could become an important tool in business operations. It’s also worth considering allowing certain assets – particularly stablecoins – to be used in corporate relations, for example, as contributions to a company’s charter capital.

And one more issue that must not be postponed – with no room for compromise – is banning access to our market for companies that have ties to the aggressor country. Ukraine’s market must be protected from any attempts to let in operators that served citizens of the aggressor state during the war. No matter how attractive their investments might appear, for such companies, all doors and opportunities must remain closed.

Finally, I want to stress that in adopting a bill on regulating virtual assets, Ukraine should not simply copy the European MiCA regulation wholesale. It would be wrong to transplant those standards without full integration into European institutions – especially since Ukraine does not yet meet EU requirements in areas like banking, anti-money laundering, counterterrorism, and anti-corruption. So yes, MiCA’s principles and values should form the foundation of the new law, but always adapted to Ukrainian realities and the fact that we are still on our path toward the EU.

Why dialogue between the market and the state matters

What’s most important now is for the state to adopt a law and listen to business. Dialogue with the market – especially with companies that have international experience – is the key to creating effective regulation. Within the Diia.City.United business community, a working group has already been set up and submitted its proposals to the bill. We invite forward-looking companies that care about the country’s future to join this initiative.

Today, Ukraine has a real chance to become the crypto capital of Europe. And this is not just rhetoric – it’s a tangible prospect that can be realized through the right decisions. To achieve it, we need transparent rules, room for innovation, and fair conditions for all market participants. If we seize this opportunity, we will attract investment and demonstrate that Ukraine is actively seeking paths to a better economic future.

The views expressed in this opinion article are the author’s and not necessarily those of Kyiv Post.

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