Hope that the government won’t attempt to outlaw or over-regulate cryptocurrencies sector, Counsel at Spenser & Kauffmann says

While the Ukrainian law enforcement strives to demonise mining farms, cryptocurrency mining became a common and routine business that works legally and pays taxes.

Nickolas Likhachov, Counsel at Spenser & Kauffmann, told about foreign experience and the prospects of regulation of Bitcoin status in Ukraine in his interview to “Focus” publication.

‘Activity of Bitcoin mining farms has raised concerns in countries where governments want to outlaw or restrict the use of cryptocurrencies (Russia, Bolivia, Ecuador, and Bangladesh). They perceive Bitcoin as a threat to their national currencies and hold that mining is an act of money forgery,’ the expert explains. He refers to the Russian Investigation Committee and the Ministry of Finance who proposed to introduce criminal liability for the use of cryptocurrencies.

In view of the recent developments in our country, the National Bank of Ukraine (NBU) left a comment on its official website, inviting government authorities to start the discussion of a joint position on the status of Bitcoin in Ukraine.

‘Bogdan Danylyshyn, Chairman of the NBU Council, has repeatedly stressed that Bitcoin cannot be used as a legal tender n Ukraine.  On the other hand, the NBU reported their plans to issue their own blockchain-based cryptocurrency as part of the Prostir national payment system project, which, in fact, is an analogy for Bitcoin,’ Mr Likhachov reminded.

According to the expert, the status of cryptocurrencies has become more clouded with the Ukrainian Parliament’s refusal to adopt bill No. 5361-d of 7 April 2017, suggesting that non-bank financial institutions are given licences to make transfers without the opening of accounts, and the right to issue electronic money. ‘What is more, it was suggested to introduce amendments to legislative instruments that would legalise the circulation of cryptocurrencies in the country,’ counsel said.

He is of the opinion that now it’s quite difficult to predict the conclusions the Ukrainian National Bank could come to in respect of the legal regulation of foreign currencies status. ‘We hope that the Ukrainian government authorities won’t attempt to outlaw or over-regulate cryptocurrencies that, in fact, have been developed to minimise the impact of the state,’ the expert summarised.