Chris Curl,
Editor
March 22, 2022
I recently wrote to you about the devastating effects of Russia’s invasion of Ukraine on both countries’ economies. I outlined the important role that cryptocurrencies were playing in helping regular people survive the conflict.
Ukraine has reportedly raised over $100 million in crypto donations and their Ministry of Digital Transformation has set a target of $200 million.
President Zelenskyy signed a virtual assets bill into law on March 16th. This bill was passed by the Ukrainian Parliament back in September but was rejected by Zelenskyy. This newly modified version fully legalizes the cryptocurrency sector.
The country has been quite open to cryptocurrencies for some time. Ukraine’s Digital Transformation Ministry stated that this was “another important step towards bringing the crypto sector out of the shadows and launching a legal market for virtual assets in Ukraine.”
This bill does a lot to move cryptocurrencies into the mainstream of Ukrainian society. Legalizing digital assets sets registration requirements for crypto service providers, as well as allows banks to open accounts for crypto companies both domestic and foreign.
The crypto market will be regulated by Ukraine’s National Securities and Stock Market Commission, which will be tasked with issuing licenses to businesses in the crypto space. The state will protect citizens’ cryptocurrency holdings with the same legal force as its fiat currency, the hryvnia. This will make it much easier for people to swap virtual assets for cash and also provide more confidence for the average person investing in crypto for the first time.
This is a huge step towards having a regulatory framework specifically tailored to the digital asset industry. Most countries simply apply the same existing financial rules to cryptocurrency exchanges, which is ineffective and archaic.
Even President Biden’s new executive order on cryptocurrency simply directs various federal agencies to conduct studies in order to take a unified approach on the regulation of digital assets. And the tone of this EO is positive which means that the U.S. is moving in the right direction by looking to adopt cryptocurrency in a major way.
More and more countries are looking to create regulatory frameworks to allow cryptocurrencies to be officially adopted.
South Korea’s President-elect Yoon Seok-youl is very pro-crypto. He recently announced that crypto trading gains would be considered the same as stock gains. And he vowed not to impose any taxes on cryptocurrency gains up to $40,000 (can the U.S. get a similar policy please?).
South Korea is a major hub for technology and cryptocurrency. Their crypto market is worth over $45 billion and over 15 million people there trade digital assets. Just last year, the South Korean government was cracking down on the industry, forcing most crypto exchanges to close shop and losing them billions of dollars. Having a new president who is embracing the crypto industry is a huge step in the right direction.
As more countries elect crypto enthusiasts into power, we will see more and more initiatives that are friendly to the digital assets industry.
This will be huge for mainstream adoption moving forward and will ultimately lead to a lot of growth for the entire cryptocurrency space.
That growth will benefit our portfolio over at Crypto Cycle, where we continue to build out and manage a real-money portfolio of cryptocurrencies. Check it out here.