Industry frustration bubbles in UK while Ukraine gets on with crypto laws

By Ian Silvera

Many of its cities are besieged, its citizens are facing a humanitarian catastrophe and the country is in an all-out war with an over-aggressive neighbour in the shape of Russia. 

But Ukraine’s steadfast government is still passing legislation, including a new Digital Assets Bill, which President Volodymyr Zelenskyy has now signed into law so that his country can further benefit from crypto donations from abroad. Ukraine has reportedly received at least $100m in cryptocurrency since the start of the conflict, according to some estimates. 

The move makes Bitcoin, Ethereum and other cryptocurrencies legal, whilst creating a regulatory framework for digital assets in Ukraine. 

“From now on foreign and Ukrainian cryptocurrencies exchanges will operate legally and banks will open accounts for crypto companies. It is an important step towards the development of the [virtual asset] market in Ukraine,” an official Ukraine government Twitter account stated. 

The decision stands in stark contrast to the UK’s own efforts on cryptocurrency regulation. Britain is not besieged, is not facing a humanitarian catastrophe or an all-out war from an over-aggressive neighbour. 

Despite all of that, there is still no regulatory framework for the UK and instead new rules from tax authority HM Revenue and Customs around staking and decentralised finance could severely hamper proof-of-stake based projects in Britain, and UK investors who want to invest in these types of initiatives abroad. 

Crypto UK Executive Director Ian Taylor, who recently spoke at SEC Newgate’s crypto regulation webinar, has called the guidance “inconsistent” and warned of the “unnecessary burdens” it creates for crypto investors. For Taylor, it’s a step in the wrong direction and for others in the industry they’re worried about no steps at all. 

Both Shiv Malik, CEO and founder of the Pool Foundation, and George McDonaugh, co-founder and Managing Director of KR1, shared those sentiments. Both executives, incidentally, have based themselves abroad at one stage in their crypto career because of a severe lack of guidance, framework and laws in the UK. 

As Malik warned, nobody wanted to be a test case for financial regulator the FCA or HMRC and such stance would continue to put off blockchain technology entrepreneurs who would be otherwise well-suited to basing their operations in the UK. Malik pointed to Gavin Wood, a co-founder of Ethereum, as just one example. 

Can Boris Johnson do a Zelenskyy and get this over the line before more potential jobs, companies and GDP are lost to the UK’s competitors?