Crypto Mining Does Not Require Governmental Oversight, Ukrainian Regulator Says

Ukrainian authorities said that crypto mining does not require regulatory activity from governmental oversight bodies or other third-party regulations.

In its manifest on virtual assets published on Feb. 7, the Ministry of Digital Transformation of Ukraine stated that mining does not require regulation by state authorities as this activity is regulated by the protocol itself and network members.

The regulator’s contribution to the industry

The agency further outlined that it will contribute to the development and implementation of decentralized technologies, as well as establish sandboxes for their evaluation and verification, and assessment of potential risks to the market.

The agency pledged to promote interaction between the financial market and virtual assets and their effective development, international best practices on taxation of virtual assets, as well as establish effective mechanisms to prevent abuse and offense from business and law enforcement.

Ukraine’s active exploration of cryptocurrencies

Ukraine has appeared to be actively exploring the digital currency and blockchain space, in recent months. At the end of January, Ukraine’s Finance Minister reportedly said that the State Financial Monitoring Service of Ukraine (SFMS) would be the authority responsible for tracking the sources of origin of the funds on citizens’ crypto wallets. Thus, the SFMS would be able to not only find out the origin of crypto but also detect how those funds have been spent.

Last December, the Ukranian government approved the final version of a money laundering law that will handle virtual assets and virtual asset service providers per FATF guidelines. 

The new law includes some guidelines on how the government intends to monitor and regulate the trading of cryptocurrencies. One of the guidelines focuses on individual crypto transactions worth less than 30,000 hrivnia ($1,300), from which the government will only collect the public key of the sender for the purpose of financial monitoring.