Statistics show that 10th adult in the world owns cryptocurrency. Many states are now concerned about whether or not crypto can be legalized and regulated.
Politicians in many countries are concerned about the main benefits of cryptocurrency, which is decentralization and anonymity. Each state’s approach to regulation of cryptocurrency is therefore different. Some countries ban cryptocurrency completely or limit its turnover, while others accept its potential and allow it to be used as a payment method or “virtual currency”.
The President of Ukraine Volodymyr Zelesky signed a similar law “On Virtual Assets”, which established the legal status for the crypto sector in Ukraine.
Three weeks after Russian “special operation”, Ukraine legalized cryptocurrency. According to the Ministry of Digital Transformation Kiev received approximately $ 100 million in cryptocurrency donations during this period. Crystal Blockchain analysts claim that these are the largest crypto donations ever made.
The Ukrainian approach to cryptocurrency regulation
The amendments Zelensky proposed to make in September 2021 are taken into consideration when the decree regarding the legalization “virtual assets” is passed. He exercised his right to veto and the law was rejected. The principal demand was to cancel the creation of a new supervision authority to regulate crypto markets.
The adopted document states that the National Commission on Securities and Stock Market and the National Bank of Ukraine will be responsible for the control of cryptocurrency.
Banks will now be legally able to open accounts for crypto companies. The state also guaranteed the judicial protection of virtual asset owners. Taxes will be levied on cryptocurrency transactions.
Mikhail Fedorov, head of the Ministry of Digital said that the new law will “bring the crypto sector out of shadows”.
Ukraine was already in the TOP-20 for the Global Crypto Adoption Index. This index measures the impact of adoption on the daily lives of ordinary citizens. Ukraine ranked 4th on this list. Chainalysis, a Singapore-based company, published the rating.
It is notable that the group is led by developing countries. The first two lines are India, Pakistan, and Vietnam. The United States ranks 8th and is the only developed country in the top 20. Russia is at the 18th spot.
Nearly a third of this list is composed of African countries.
A Methodology for Cryptocurrency Regulation in Africa
Despite the fact there are some serious issues with the Internet in certain African countries and some crypto transactions are prohibited in some countries, the African digital marketplace is still one of the fastest growing. Chainalysis analysts attribute this to a high level of inflation. To protect their savings and transfer funds to other nations, Africans use cryptocurrency.
The continent’s high crypto potential is directly linked to the fact that local regulators have close access to central crypto-exchanges. Alternatively, transactions are mainly on P2P platforms .
We can see that South Africa, Kenya, Nigeria and Tanzania are the top 20 countries for virtual currency adoption according to Chainalysis. These countries include cryptocurrency in their legal system.
Thanks to cryptocurrency, a small settlement in Tanzania was able to transform itself into a smart village. World Mobile is responsible for delivering the Internet to remote African areas. World Mobile makes it possible to use blockchain technology to pay for Internet services using its native World Mobile Tokens. The World Mobile cryptocurrency can be used in the region – it cooperates with the Zanzibar E-Government Agency (Zanzibar forms part of the United Republic of Tanzania).
Afghanistan is ranked 20th in the Rating of Chinalysis. This is where the banking system crashed after the Taliban took power. It is almost impossible to leave the country without having the option to buy cryptocurrency.
Cryptocurrency regulation in the US
The federal regulation of the US crypto market is considered in the contexts of national security as well as the prevention and detection of money laundering and financial crime. The Financial Crimes Enforcement Agency, FinCEN, regulates cryptocurrency.
Securities and Exchange Commission (SEC), manages issues related to securities and stock markets.
If FinCEN provides this license, companies offering cryptocurrency exchange services must apply and report to regulators. Crypto-exchanges are responsible for storing all transactions and reporting suspicious transactions.
The taxation of cryptocurrency transactions is controlled by the Internal Revenue Service. The tax rate is different for each state.
A decree by the US President Joe Biden regulating regulation of digital assets. Federal agencies have until December 31st to evaluate the benefits and risks of crypto-related activities.
This document will protect investors and consumers and reduce risks associated with illegal activity. It will also ensure financial stability in the United States as well as around the globe.
Particular emphasis is placed on the directive’s task regarding maintaining US leadership in digital assets.
The White House directed the Ministry of Justice that it pay close attention to the digital dollar audit. The US administration is investigating the possibility of creating a legal framework for CBDC release.
Washington is also considering, along with European partners the possibility of restricting Russian users’ access to cryptocurrency, in accordance the sanctions against Russia that were announced after the start the military operation in Ukraine.
What is Russia’s position on legalizing the crypto market?
Two financial institutions are battling over the regulation of cryptocurrency in Russia. The Central Bank proposes that mining and cryptocurrency operations be prohibited. The Ministry of Finance insists on legalization of crypto markets. In February, the relevant bill went to government.
The Ministry of Finance proposes that mining in Russia be legalized. It will allow for cryptocurrency to be purchased and sold only when the holders of crypto wallets are identified. Exchanges will also be instructed to warn customers about the high risk of investing in cryptocurrency. It is also proposed that users be tested for market knowledge and the meaningfulness of risk.
Digital currency can only be used as an investment tool. It will not be allowed to be used to pay for goods or services with cryptocurrency.
The bill by the Central Bank is completely contrary to its content. It proposes to ban the circulation and dissemination of information about cryptocurrency. According to the Central Bank’s head, increasing cryptocurrency transactions could threaten financial stability. The bill’s text also includes a ban on banks owning cryptocurrency.