On September 8, 2021, the Ukrainian parliament passed a bill that will regulate Bitcoin and other cryptocurrencies. Although cryptocurrencies have been around in Ukraine for a long time, they were not considered legal or illegal at the time. Since people tend to believe that their country’s currency is depreciating, they were eager to find ways to improve its power.
What is Bitcoin (BTC)?
Bitcoin is an electronic money that uses cryptography to secure its transactions. Its value has increased significantly since its creation. It is a decentralized digital currency that uses open-source code. An anonymous user manages its network. Bitcoin became the world’s first digital currency in 2009. Its introduction has sparked debate on how we should treat it as a form of payment.
Why is Ukraine Legalizing Cryptocurrencies?
The launch of Bitcoin in Ukraine coincided with a drop in its value by almost 12%. According to CoinDesk, the currency’s value dropped from over $52,000 to around $46,472. Due to the new law on digital currency, Ukraine will be able to regulate the operation of virtual assets. This will allow the governments to establish regulations for the market.
This bill allows businesses to operate in Ukraine using cryptocurrencies, especially BTC. It also gives citizens and business owners the autonomy to own Bitcoin. It also sets up guidelines on how to regulate Bitcoin in the future.
The Ukrainian Parliament is expected to pass various amendments to their civil codes and tax laws before the end of the year, which will allow businesses and investors to operate in the country using crypto and Bitcoin. El Salvador’s long-dated bonds have suddenly sold off, raising the country’s debt market pressure.
Other Countries Legalizing Crypto Currencies
As a currency, no central bank of any government controls BTC. This makes it a safer alternative to traditional payment methods. Most countries have yet to make a definite decision regarding Bitcoin’s legal status. Despite this, some countries like Australia and Canada have already started accepting Bitcoin as payment and legal tender.
This is a great step towards making Bitcoin a standard in the country. However, in order to fully utilize the potential of Bitcoin, one should avoid adopting too many regulations.
Even though bitcoin is over ten years old, many countries can still find formal structures to restrict and regulate it. Many governments have struggled to find a way to allow BTC lawful use. While many countries are introducing digital currencies, many others are wary due to their volatility and potential to carry out criminal activities.
Although the US government has generally taken a positive stance toward Bitcoin, it is not yet clear how it will prevent illegal transactions. Despite this, many prominent businesses like Microsoft, Subway, and Dish Network have started accepting Bitcoin as a payment method.
Many countries though are still considering how to regulate Bitcoin and Altcoins. For the most part, bitcoin is still illegal in many parts of the world.