1. What the war did to crypto

Before February 2022, cryptocurrency in Ukraine was largely an instrument of speculation and long-term investment — a niche market for technology enthusiasts. The full-scale invasion changed that within weeks.

When banks restricted international transfers, the hryvnia began to lose value and millions of people were trying to save their money in complete uncertainty, crypto became a practical tool. It was used to move funds abroad in the first days of the invasion; to preserve value through dollar-pegged stablecoins (USDT, USDC); to send money without banking infrastructure; and to raise money for the army from across the world, quickly and without intermediaries.

Ukraine in figures: the scale of the crypto market (2024–2025)

Sources: Chainalysis Global Crypto Adoption Index 2025; EBRD (2024); Disruption Banking (November 2025); CoinLedger Research (2025).

Key takeaway: Crypto in Ukraine has stopped being an investment instrument and become the infrastructure of financial survival. That has changed the audience, the scale and the stakes of regulation alike.

Policy challenge: Ukraine is one of the world leaders in crypto adoption, yet it operates without a full legal framework four years after the basic law was passed. The longer the market exists in a legal vacuum, the further it moves into the shadows and the harder it becomes to legalise later.

2. Four years of waiting: where Ukraine stands

On 17 February 2022 — four days before the full-scale invasion began — the Verkhovna Rada passed the Law on Virtual Assets (No. 2074-IX). The President signed it on 16 March 2022. The law has still not entered into force.

The reason is written into the text: it takes effect only once amendments to the Tax Code on the taxation of crypto transactions are adopted. Without that document the law remains passed but dead.

On 24 April 2025 the Verkhovna Rada Committee on Finance recommended that Draft Law No. 10225-d — the Tax Code amendments meant to switch on the main law — be adopted in the first reading. As of the end of May 2026 it had not yet been passed in the second reading.

Current status of the legislative framework

Source: Verkhovna Rada of Ukraine, official website (itd.rada.gov.ua), February 2026.

3. MiCA: what the EU has done and where Ukraine lags behind

The EU Regulation on Markets in Crypto-Assets (MiCA, Regulation (EU) 2023/1114) became fully applicable on 30 December 2024. It is the world’s first comprehensive regulatory framework for the crypto industry — and the standard Ukraine is seeking to approach through Draft Law No. 10225-d.

[FIGURE] What MiCA regulates

Source: Regulation (EU) 2023/1114 (MiCA); Draft Law No. 10225-d (itd.rada.gov.ua).

The conclusion is mixed: at the level of the rules themselves, Ukraine reproduces MiCA fairly closely. The problem lies not in the text of the law but in the architecture of regulation.

4. Two regulators instead of one: a systemic problem

Law No. 2074-IX divides powers between two authorities: the NBU regulates tokens pegged to fiat currencies and payment-related aspects, while the NSSMC regulates tokens with the characteristics of securities and investment products. In practice the boundary between these categories is blurred — and it is precisely where it is blurred that regulatory uncertainty arises.

MiCA solved this problem through a single supervisory authority at EU level (ESMA) and a clear demarcation of asset categories within the regulation itself. Ukraine is implementing the MiCA asset categories while keeping a dual regulatory architecture. Without coordinated secondary legislation there is a risk of creating a situation in which the same asset falls under different requirements depending on which regulator a market participant ends up with.

Key risk: until coordinated secondary legislation is agreed between the NBU and the NSSMC, legal uncertainty persists even after both laws enter into force. The market may end up suspended in a situation where everything is formally legal but nobody in practice understands on what terms, or to whom, to apply.

5. How crypto income will be taxed

Draft Law No. 10225-d establishes clear rules for the taxation of crypto transactions by individuals for the first time. The key parameters:

Source: Draft Law No. 10225-d, itd.rada.gov.ua, first-reading version, April 2025.

What raises questions

The transitional regime is the only window for legalisation without penalties. In 2026 holders of crypto-assets acquired before the law enters into force may declare them at a reduced rate of 5% personal income tax plus 5% military levy, instead of the standard 18% plus 5%. For the holder of a portfolio built up in 2020–2021 the difference can run to tens of thousands of hryvnia. Anyone who does not use that window in 2026 pays the full rate the following year. This is the one moment when coming out of the shadows is financially better than staying in them.

There is, however, a technical trap worth knowing about in advance. The financial result is calculated in hryvnia and takes exchange-rate differences into account. Under devaluation, a transaction can produce a loss in dollars yet a formally positive result in hryvnia terms because the hryvnia has fallen — and the taxpayer pays tax on income never actually earned.

A simple example: you buy one ETH for USD 2,000 in November, when the rate is UAH 38 to the dollar. You sell it for USD 1,800 in May, when the rate is already UAH 42. In dollars that is a loss of USD 200. In hryvnia: the sale is USD 1,800 × 42 = UAH 75,600 and the purchase USD 2,000 × 38 = UAH 76,000 — a loss of UAH 400 as well. But if the rate falls more sharply, or the asset is held for longer, a hryvnia “profit” on a dollar loss becomes entirely possible. For Ukraine, with its currency swings, this is not an extreme scenario but everyday arithmetic.

Verified: the question was analysed on the basis of the text of No. 10225-d (EY Ukraine, April 2025) and a comparative analysis of Polish legislation.

The first-reading version contains no mechanism to protect against this inflationary taxation. EY Ukraine states directly that fluctuations in the hryvnia exchange rate can in practice leave taxpayers with a hryvnia “profit” on transactions that were loss-making in foreign currency — and paying tax on it.

The Polish solution: in Poland every transaction in a foreign currency is converted into zloty at the official National Bank of Poland rate for the nearest preceding business day. The rate is fixed at the date of the transaction rather than at year-end, which removes the phantom-profit effect of devaluation.

Recommendation for the second reading of No. 10225-d: fix the hryvnia exchange rate at the date of each individual transaction, along the Polish model, rather than applying exchange-rate differences calculated at the end of the reporting year. The question has not been raised publicly in the run-up to the vote, which is in itself an argument for adding it to the list of proposals.

6. Martial law: between security and development

Regulating the crypto industry during active hostilities means balancing two opposing needs. On one side: control over capital movements, prevention of money laundering, monitoring of financing for potentially undesirable actors. On the other: cryptocurrency has already proved itself an important instrument of financial resilience for citizens and for the state.

Through official state crypto wallets Ukraine has raised hundreds of millions of dollars for the Armed Forces — from donors around the world and without the bureaucracy of conventional transfers. The same environment can be used to circumvent sanctions or finance illegal activity. The state understands this, hence the strict requirements for the authorisation of service providers and for financial monitoring.

The regulatory dilemma: full liberalisation carries security risks. Excessive control pushes the market into the shadows. The optimal approach is transparency and authorisation for legal players, combined with strict liability for breaches. That is what Draft Law No. 10225-d is aimed at.

The CASP authorisation system: what is envisaged

The draft law introduces mandatory authorisation for all crypto service providers — exchanges, wallets, exchangers — known in MiCA terminology as CASPs (crypto-asset service providers): custody, trading, exchange, transfer and advice. The requirements cover organisational standards, minimum capital, compliance procedures and financial monitoring in line with anti-money laundering legislation.

Providers already operating before 31 December 2025 must register by 1 July 2026. The state’s message is clear: go legal or go — there will be no third option.

There is a security side to this as well. Since 2024 Russia has been using crypto systematically to circumvent sanctions. The rouble-pegged stablecoin A7A5 processed more than USD 93 billion over 10 months of 2025; it was sanctioned by OFAC and the EU, but had already become a full settlement rail for sanctioned actors. The Garantex exchange processed more than USD 60 billion before it was shut down in March 2025 and was immediately replaced by Grinex. In 2024 OFAC sanctioned 13 entities linked to Russia for assisting sanctions evasion through crypto, including companies servicing pro-Russian armed formations in the occupied territories of Ukraine (Chainalysis, 2025; Harvard Davis Center, 2026).

For an unregulated Ukraine this carries a specific risk: unregulated Ukrainian platforms may unknowingly become transit nodes for sanctioned flows. Without a CASP register and mandatory AML/CFT monitoring, the state has no instruments to trace and block such transactions. The consequence is not only a breach of the EU and US sanctions regimes but also reputational risk that will complicate European integration.

7. International standards: not only MiCA

Draft Law No. 10225-d is openly modelled not only on MiCA but on two broader international standards that will set the rules for the industry as a whole.

CARF (Crypto-Asset Reporting Framework, OECD): a global standard for the automatic exchange of information on crypto transactions between countries. It is the equivalent of the CRS for conventional financial assets. The draft law presents the introduction of reporting by service providers as the first step towards CARF compatibility.

DAC8 (Directive (EU) 2023/2226): obliges service providers in the EU to share data automatically with the tax authorities of EU member states. For Ukraine this means that once the law enters into force and Ukrainian providers are authorised, they will be able to take part in the international exchange of information. If not, they will be the only ones in Eastern Europe without CARF compatibility, and clients from the EU will simply be unable to work with them legally.

Together with MiCA, these two standards form a new global architecture of regulation. Countries that fail to adapt risk becoming jurisdictions in which legal players cannot operate, because their clients in the EU will not share data with an unregulated market.

8. Conclusions: three things that need doing now

Ukraine has a sound legislative architecture and a prolonged executive paralysis. Passing the basic law in 2022 without the corresponding Tax Code amendments was a technical mistake that has cost the market four years of legal uncertainty. Draft Law No. 10225-d corrects that mistake — but until it is passed, nothing changes.

Three priorities, without which regulation remains on paper:

Pass Draft Law No. 10225-d in the second reading — so that the main law finally enters into force. Every month of delay is another month of a market operating in a grey zone, where the state collects no taxes and investors have no legal protection.

Agree secondary legislation between the NBU and the NSSMC — before the law enters into force, not after. Without it the market will have a legal framework with no practical application. The division of competence between the two regulators must be set out clearly and in advance.

Clarify the taxation methodology for exchange-rate differences — so that the system does not tax phantom profit. This is a technical question, but it may become a serious barrier to voluntary legalisation if it is not resolved before launch.

The market already exists: large, active and partly in the shadows. The question is whether it will be transparent, protected and tax-paying. For a country seeking EU accession — and for a market that proved its worth during the hardest months the state has known — there is one answer: pass the law this session, not the next.

Sources

1. Law of Ukraine on Virtual Assets of 17 February 2022, No. 2074-IX [in Ukrainian]. URL: https://zakon.rada.gov.ua/laws/show/2074-20#Text

2. Draft Law No. 10225-d on amendments to the Tax Code of Ukraine regarding the regulation of virtual asset turnover [in Ukrainian]. URL: https://itd.rada.gov.ua/billinfo/Bills/Card/56271

3. Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on markets in crypto-assets (MiCA). URL: https://eur-lex.europa.eu/eli/reg/2023/1114/oj/eng

4. Law of Ukraine on Payment Services of 30 June 2021, No. 1591-IX [in Ukrainian]. URL: https://zakon.rada.gov.ua/laws/show/1591-20#Text

5. Council Directive (EU) 2023/2226 (DAC8). URL: https://eur-lex.europa.eu/

6. OECD. Crypto-Asset Reporting Framework (CARF), 2022. URL: https://www.oecd.org/tax/exchange-of-tax-information/crypto-asset-reporting-framework-and-amendments-to-the-common-reporting-standard.htm

7. Chainalysis. Global Crypto Adoption Index 2025. URL: https://www.chainalysis.com/blog/2025-global-crypto-adoption-index/

8. How Ukrainians adapted crypto during the war: from savings to international transfers [in Ukrainian]. Minfin, 23 April 2025. URL: https://minfin.com.ua/ua/2025/04/23/149503734/

9. Kostenko Yu. O., Yurkivska M. V. Legal regulation of cryptocurrency circulation in Ukraine: tax and institutional aspects [in Ukrainian]. Legal Journal of Donetsk National University. 2025. No. 2. Pp. 180–190.

10. Starchuk O. V., Chubokha N. F., Androsovych A. V. Legal aspects of the regulation of cryptocurrencies and blockchain technologies in Ukraine [in Ukrainian]. Economics. Finance. Law. 2024. No. 3. Pp. 99–102.

11. Disruption Banking. Ukraine’s crypto landscape: war, wallets and Web3 (November 2025). URL: https://disruptionbanking.com/2025/11/ukraine-crypto-war-wallets-web3/

12. CoinLedger. Ukraine Cryptocurrency Tax Guide 2025. URL: https://coinledger.io/tax-guides/ukraine-crypto-tax

13. EBRD. Regional Economic Prospects: Ukraine Digital Economy Data, 2024. URL: https://www.ebrd.com/

Note on the use of AI: This material was prepared with the use of artificial intelligence tools (Claude, Anthropic) for structuring, analysing and editing the text. Responsibility for content, verification of data and the final editorial decision rest with the authors.

EU Ready: from negotiations to opportunities  |  Ukrainian Institute for the Future  |  uifuture.org

The views, assessments and conclusions set out in this article are the personal position of the author and do not necessarily reflect the official position of the Ukrainian Institute for the Future, its partners or its donors.

This publication was produced by the NGO Ukrainian Institute for the Future with the support of the Askold and Dir Fund, administered by ISAR Ednannia under the project “Strong Civil Society of Ukraine — a Driver of Reforms and Democracy”, funded by Norway and Sweden. The content of this publication is the responsibility of the NGO Ukrainian Institute for the Future and does not reflect the views of the governments of Norway or Sweden or of ISAR Ednannia.

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