Almost every country’s government has taken some kind of stance towards cryptocurrencies and their regulations. Now, the Ukrainian government will back their own crypto regulators in an effort to bring order to the crypto market of this country.
Government allows the creation of a regulatory framework
Ukraine’s Financial Stability Council has given their support to the concept of bringing new cryptocurrency regulations. The decision was announced by SSMCS’s (National Securities and Stock Market Commission) head, Timur Khromaev, who brought it to the public via Facebook on July 20th.
Khromaev stated that this concept will involve the classification of cryptos and their tokens as financial instruments. It will establish various functions and roles of different governmental bodies that will be in charge of regulating such instruments. The participants of and crypto transactions will require the proper licenses as defined by the conditions behind information disclosures.
The Council is made up of the Minister of Finance, the National Bank of Ukraine’s Governor, the Deposit Guarantee Fund’s Managing Director, the head of the National Commission for State Regulation of Financial Services Markets, and the head of National Securities and Stock Market Commission. These members are tasked with finding and eliminating the stability risks of banking and financial systems on a national level. Any decisions will be considered recommendatory.
The framework is necessary
According to Khromaev’s statement, this is an important first step towards creating a certain consensus among financial regulators and various agencies within the government. He added that the regulatory framework’s aim is to ensure a high level of transparency in the interaction between market participants and investors.
Recognizing cryptos as financial instruments was actually a recommendation by the NSSMC itself. It came as a suggestion back in May of this year and, on that occasion, Khromaev emphasized that it was necessary to legally recognize cryptos and to properly adopt the regulators’ position.
He added that the crypto industry’s development has allowed the market to become a significant part of the financial and economic relations on a global scale.
About a month ago, Ukraine’s State Special Communications Service unveiled that they have no intention of regulating crypto mining. This came in response to an information request sent to them by BRDO (Better Regulation Delivery Office). Back then, the agency stated that introducing crypto mining licenses is out of the question. Introducing such licenses would make crypto mining a special type of activity, and the agency has firmly refused to do so.