Ukraine digital currency bill returned to parliament over proposed ‘expensive’ watchdog, other issues

Ukraine digital currency bill returned to parliament over proposed ‘expensive’ watchdog, other issues

The President of Ukraine, Volodymyr Zelensky, has returned the fledgling digital currency bill to parliament pending further revisions, as the country moves towards establishing a regulatory framework for digital assets and digital currencies.

Among other issues, the office of the president flagged concerns about the establishment of a new agency to oversee digital currency regulation, which it suggested could be expensive relative to the policy gains from instigating the framework.

“The creation of a new body, as provided by this law, will require significant expenditures from the state budget. Therefore, Volodymyr Zelensky proposes to include the regulation of the circulation of virtual assets in the competence of the National Securities and Stock Market Commission.”

Ukraine’s equivalent agency to the U.S. Securities and Exchange Commission (SEC), the National Securities and Stock Market Commission is itself underfunded, and some have questioned whether the agency has the resources or competence to oversee any new regulatory regime.

The bill will now be reconsidered by the Verkhovna Rada, Ukraine’s national parliament, for further revision, with the bill now several years through the legislative process. Nevertheless, commentators are suggesting the bill is progressing closer to being added to the country’s statute books, which would see it becoming law in the country.

While the legislative position in the country remains uncertain over the near future, Ukraine has nevertheless been pushing towards becoming a regional center for digital currency and digital assets. In part, the drive has been seen as a way of overcoming stagnant investment in the country, both from local and overseas investors.

However, there have been some suggestions that the country’s reputation for corruption and capital flight could still hamper efforts to establish Ukraine as a destination for the digital currency sector.

The bill will now be reconsidered by lawmakers to weigh up the alternative options.

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