Ukraine's Crypto Regulation Bill Legalizes Digital Asset Taxation

Ukraine is preparing to join the list of countries that welcome cryptocurrencies with its new rules on crypto regulation. With 246 lawmakers voting in favor, Ukraine's Verkhovna Rada has approved the first reading of a bill that aims to legalize and tax cryptocurrencies. This move shows the country’s forward-thinking stance on virtual assets and blockchain technology.

Ukraine Advances Cryptocurrency Regulation

In a surprising turn of events, Ukraine has made strides in crypto regulation by moving to legalize virtual assets. The bill also sets up a framework for cryptocurrency taxation.

The proposed law, known as the "Crypto Legalization and Taxation Bill," aims to recognize cryptocurrencies as legal entities. With this rule, digital assets will incur an 18% income tax and a 5% military tax on profits. There will also be a temporary 5% tax on fiat conversions for the first year. The government intends to bring transparency and structure to its quickly growing Web3 economy.

Lawmaker Yaroslav Zhelezniak posted on Telegram that the digital asset bill passed its first reading with solid support, receiving 246 votes in favor. While the bill specifies tax rates, some important details are still unclear. There is uncertainty about which authority will oversee the digital asset space, with the National Bank of Ukraine (NBU) and the National Securities and Stock Market Commission (NSSMC) being possible regulators.. Addressing this, Zhelezniak said,

“I don't see much point in going into detail now, there will be many changes before the second reading. It is still unknown who the regulator will be (NBU or the National Securities and Stock Market Commission).”

Ranks Eighth in Cryptocurrency Adoption

According to Chainalysis’s 2025 report, Ukraine takes the eighth position in cryptocurrency adoption. The country has emerged as a leader in blockchain adoption, particularly in the DeFi space, while also building its digital asset reserves to drive financial innovation and growth.

However, due to the lack of a clear crypto regulation , the country lost at least $10 billion to digital asset hacks and threats. A recent report published by the Royal United Services Institute (RUSI) said,

“Ukraine-specific risks are primarily connected with the over-the-counter (OTC) activities in the country, its role as a threat hub and the role of crypto in funding procurement of sanctioned components for the Russian military, money mules and others.”