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Ukraine Legalizes Bitcoin and Other Cryptocurrencies Amid Rising Tensions with Russia

Ukraine amidst the concerns expressed by several top officials from central banks all around the world, including the Managing Director Kristalina Georgieva over the spread of these unbacked virtual currencies and the rising tensions between Russia and Ukraine, the latter has taken a decision to legalize cryptocurrencies.

Last Thursday, MykhailoFedorovon, Ukraine’s Vice

Prime Minister, in a tweet, announced that the Parliament of the country has passed a bill on virtual assets, which will forthwith make cryptocurrencies legal in the country. He added further that by taking such a move, Ukrainians’ funds will be safeguarded from any possible abuse or fraudulent usage. His tweet, from the username, @fedorovmykhailo, stated, “Ukraine is already in Top- 5 countries on cryptocurrency usage. Today we made one step forward: Parliament adopted law on virtual assets! This will legalize crypto exchangers and cryptocurrencies and Ukrainians could protect their assets from possible abuse or fraud.”

Because of the recent rising tensions that a Russian military

invasion may take place on Ukraine, bitcoin payments have been on the increase to the volunteer and hacking groups that support the Ukrainian government. Instead of banks and financial agencies that might stop such transactions, donors are making payments to such non- profit organizations to show their support to the Ukrainian government without any hurdles or restrictions.

An attempt of a similar nature was made in October 2021. The attempt was regarding establishing an independent regulatory agency to oversee cryptocurrency exchanges, which was sent back by the president of Ukraine for revisions. Now that this current bill is passed, it is the second (successful) effort to legalize cryptocurrencies like Bitcoin.

As the Ukrainian National Bar Association reported,

transfers across international border will be subjected to statutory surveillance. However, for some cases of domestic currency transfers, Ukraine has started the ID verification that was started in 2020 as part of the country’s efforts to combat money laundering.

Many central bank officials around

the world have been vocal about their stands against the digital currencies. Georgieva said that these ‘unbacked cryptocurrencies’ will not be able to compete with the wisely designed central bank digital currencies (CBDCs), earlier this week. Deputy Governor of the Reserve Bank of India, T Rabi Sankar, made a compelling argument against the prohibition of crypto last Monday, making claims that they are even worse than Ponzi schemes and that they pose a grave threat to a country’s financial sovereignty. Adding to this list, is Sarah Breeden, Executive Director for financial stability at the Bank of England, who warned businesses to proceed with caution whenever dealing with cryptocurrency.

Also Read: Cryptocurrency Becomes the New Headache in Divorce Cases

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