A national bitcoin reserve may appear in Ukraine: what is known about the new financial initiative
14 May 22:36
Ukraine may become one of the first countries in the world to officially create a national strategic reserve in bitcoin. Such an initiative is already being prepared at the legislative level, and if adopted, it will allow the state to keep part of its financial reserves in digital assets along with traditional ones, such as currency, gold, and securities, "Komersant Ukrainian" reports citing Incrypted media.
The initiator of the creation of a national bitcoin reserve is the first deputy chairman of the Verkhovna Rada Committee on Finance, Taxation and Customs Policy Yaroslav Zheleznyak. According to him, the draft law that will define the legal and organizational framework for the reserve’s functioning is at the final stage of preparation. It is planned to be submitted to the Parliament in the near future.
The document is expected to outline the mechanisms for purchasing, storing, and auditing cryptocurrency assets, as well as regulating the risks associated with the volatility of digital currencies.
Project goal
The main goal of creating a bitcoin reserve is to diversify government financial instruments. The government sees bitcoin as a means of protecting the national economy in the face of geopolitical instability, inflationary risks, and currency turbulence. Following the example of El Salvador, where bitcoin is officially recognized as the state currency, Ukraine is seeking to keep some of its strategic assets in crypto form.
Partnership with Binance
Binance, the world’s largest crypto exchange, may become a key partner in the project. Its CEO Richard Teng has previously reported on cooperation with several countries to create similar digital reserves. Binance has already cooperated with Ukraine on crypto regulation issues, in particular, as part of a memorandum with the Ministry of Digital Transformation.
A look at international practice
The creation of cryptocurrency reserves is a new trend in global financial policy. In addition to El Salvador, which has already accumulated more than 5 thousand BTC in the state reserve, Bhutan, Liechtenstein, and some African countries are publicly considering such plans. In the G7 countries, state participation in the cryptocurrency market is still limited by regulation and reservations, but the demand for digital assets is growing among public funds.
Potential benefits and risks
The introduction of a national bitcoin reserve may
- increase the investment attractiveness of Ukraine in the eyes of the crypto community;
- provide quick access to liquid digital assets in crisis situations
- increase financial independence in the event of sanctions or restrictions on access to international reserves.
At the same time, experts emphasize the high risks, in particular, due to the volatility of the bitcoin exchange rate and the lack of mechanisms to protect capital from losses.
Next steps
After the draft law is submitted to the Verkhovna Rada, it must be supported by the relevant committee and put to a vote. At the same time, the government is working on developing a regulatory infrastructure for verifying digital assets, storing keys, and monitoring transparency of transactions.
If the initiative is implemented, Ukraine will become one of the first countries in the world to officially recognize cryptocurrencies as part of its strategic reserves. This can become an important element of the country’s new financial architecture: open to innovation and adaptation to global technological trends.
Read also: A new era of corruption: how cryptocurrency has become a means of bribery in Ukraine
Earlier, MP Yaroslav Zheleznyak said that the draft law on the regulation of the virtual asset market, which was supposed to be the first step towards legalizing cryptocurrencies in Ukraine, was unofficially blocked by the President’s Office.
The document was developed in cooperation with a number of state and international institutions, including the National Bank, the Ministry of Digital Transformation, the IMF, and the EU. After lengthy approvals, the draft law was unanimously supported by the relevant committee of the Verkhovna Rada. Nevertheless, according to Zhelezniak, the document has repeatedly disappeared from the parliament’s agenda, most recently after a meeting at the President’s Office chaired by Volodymyr Zelenskyy.
According to the MP, the key role in blocking the initiative is played by Ruslan Magomedov, the head of the National Securities Commission and a former adviser to Andriy Yermak. It was Magomedov who insisted on withdrawing the draft law from consideration and suggested sending it to the SBU for review, which, according to the MP, indicates political influence and possible corruption motives.
Zheleznyak claims that the Commission, despite the lack of resources and trust from international partners, is trying to gain full control over the cryptocurrency market. Meanwhile, the SBU, according to him, is actively “covering up” the illegal crypto market and online casinos, which remain one of the main sources of unofficial income.
The blocking of the draft law hinders the development of the digital economy and creates losses for the budget. At the same time, the MP declared his readiness to continue the fight for its adoption, in particular through publicity and public pressure.
What the draft law on cryptocurrencies says
The 200-plus page document contains provisions on the legal status of cryptocurrencies, defines the competence of regulators, taxation, circulation requirements, and the specifics of working with virtual assets.
The draft law was developed over almost six months and is part of Ukraine’s commitments to the International Monetary Fund. The respective legislative regulation is a key step towards the integration of the Ukrainian financial market into the international legal system of digital assets circulation.
The document envisages the introduction of a special taxation regime for transactions with virtual assets, including cryptocurrencies, tokens and other forms of digital assets.
Danylo Hetmantsev, chairman of the Verkhovna Rada’s Finance Committee, explained that the tax will be charged only on net profit, i.e., the difference between the cost of buying crypto assets and the income from their sale.
In the first year after the law comes into force, a preferential tax regime will be in effect. In particular, the personal income tax (PIT) rate will be 5% instead of the standard 18%. In addition, during this period, there will be no need to confirm the costs of purchasing cryptocurrencies. This should stimulate asset legalization and contribute to the formation of a transparent crypto market in Ukraine.
After the end of the grace period, cryptocurrency holders will be required to provide documents confirming the purchase of digital assets in order to benefit from the deduction of expenses for tax purposes. In addition to personal income tax, a 1.5% military tax will also be levied on profits from cryptocurrency transactions.
The draft law also establishes tax exemptions for certain types of cryptocurrency transactions. For example, transactions involving the exchange of one cryptocurrency for another will not be taxed if their value does not exceed one minimum wage at the time of the transaction. In addition, mining – the process of creating new blocks in the blockchain – will also be exempt from taxation if the resulting assets are not sold for fiat money.
The draft law pays special attention to the regulatory framework. It is envisaged that the National Securities and Stock Market Commission and the National Bank of Ukraine will be the main regulators in the field of virtual assets. They will be empowered to register market operators, license their activities, supervise compliance with financial monitoring rules and combat money laundering.
In addition, the law provides for a transitional period during which a simplified mechanism for registering crypto operators will be in place. This will allow market participants to adapt to the new requirements without excessive administrative pressure. It is expected that these conditions will encourage a large number of businesses that previously operated without official registration to come out of the shadows.
Economic experts interviewed by the media explain that the adoption of the draft law will allow Ukraine to take another step towards building an open and competitive digital asset market. This is important not only in terms of attracting investment but also for the overall development of the national financial infrastructure. It is expected that the full functioning of the new legal framework will facilitate the legalization of cryptocurrency transactions, reduce the volume of shadow financial flows, and increase confidence in Ukrainian jurisdiction among international partners.
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