Ukraine took a decisive step toward legalizing cryptocurrency on September 3, 2025, as the Verkhovna Rada approved in the first reading draft law No. 10225-d—a comprehensive framework for regulating and taxing virtual assets. Lawmakers voted 246 in favor, advancing a package that would finally align Ukraine’s crypto rules with European standards and give clarity to traders, exchanges, and investors.
What passed—and why it matters
According to multiple Ukrainian outlets and crypto trade press, the bill defines how virtual assets (VAs) will be treated for tax purposes and sets out who will supervise the market. The text indicates that profit from VA operations over a year—that is, the difference between sales proceeds and acquisition costs—will be taxed, with a general rate of 18%personal income tax referenced in the bill’s summary. Crucially, the proposal includes a preferential 5% rate on conversions to fiat in the first year after the law takes effect, an incentive designed to bring activity out of the gray market. Longer-term, media summaries indicate an effective 23% burden on profits (18% income tax + 5% military levy).
The first reading is not the finish line, but it is a major milestone. Ukraine adopted a Law on Virtual Assets back in 2021–2022, yet full implementation stalled pending tax code amendments. The new bill is intended to provide those amendments and harmonize oversight with EU rules—closing the long-standing gap between legal recognition and practical enforcement.
Key tax proposals at a glance
- Tax base: Annual net profit from crypto operations (income minus acquisition costs).
- Headline rates: Media accounts point to 18% income tax on profit, plus a 5% military levy; first-year fiat off-ramp at 5% to ease transition.
- Exemptions: The bill’s outline highlights crypto-to-crypto exchanges (VA→VA) as not taxed, sales up to the value of one minimum wage, and assets received via issuance or free distribution (including for personal data) as exempt at the moment of receipt. Details are expected to be refined before the second reading.
These mechanics aim to reduce friction for active users (who often trade pairs like BTC/USDT or ETH/USDT) while ensuring profits are properly reported. Policymakers argue clear rules should formalize a large shadow market, expanding the tax base and improving consumer protection.
Who will regulate the market?
One unresolved question is the lead market regulator. Lawmakers and officials have floated the National Bank of Ukraine (NBU) and the National Securities and Stock Market Commission (NSSMC) as candidates; the Ministry of Digital Transformation is also referenced in some reports as a stakeholder, with the final distribution of powers to be decided as the bill advances. In any case, supervision would align with EU norms (notably MiCA) and likely include registration, reporting, and audit powers for service providers.
When could the rules take effect?
While the formal commencement date will depend on the final text, Ukrainian tech media reporting on the bill suggests January 1, 2026 as a target start, giving time to select a regulator, issue secondary rules, and let businesses adapt. Expect changes between the first and second readings; even supporters in parliament have stressed that “many changes” will be made before the final vote.
How crypto would be classified
Outlets summarizing the bill note that virtual assets are grouped into three types:
- Assets “tied” to real-world assets (e.g., tokenized securities).
- Assets pegged to currencies (e.g., stablecoins like USDT).
- Other cryptocurrencies (e.g., Bitcoin, Ether).
These categories will inform disclosure, licensing, and advertising rules for exchanges and issuers.
From gray to regulated: the compliance roadmap
For crypto service providers (exchanges, custodians, brokers), the bill introduces authorization/registration, annual reporting, and a schedule of fines that ramps up over time. Several analyses also point out broad supervisory powers proposed for the future regulator (on-site inspections, document seizures with court orders, and strict timelines for court reviews of enforcement actions), which critics say need careful balancing to protect due process.
The Rada’s bill page confirms the legislative pathway to date—registration in April 2025, committee approvals in the summer, and the first reading now through—with additional expert, budget, and anti-corruption reviews logged. The vote tally will likely appear there once the clerks publish it; for now, the 246-vote count is corroborated by national and business media.
Market impact and next steps
For retail users, the message is straightforward: crypto will not be legal tender, but it will be legal to own and trade under clear rules—bringing Ukraine closer to a MiCA-compatible regime that foreign exchanges and fintechs understand. Cleaner tax treatment (annual profit, exemptions for VA→VA trades, transitional 5% fiat off-ramp) lowers compliance anxiety and could attract more venture and institutional interest as the war-time economy rebuilds.
From here, committee markups and a second reading will determine the final shape of taxes, supervision, and definitions. Observers expect robust debate over the military levy, the scope of regulator powers, and privacy safeguards. But after years of stop-start progress—law adopted in 2021/2022 but waiting on tax changes—the momentum now points to an operational framework within the next calendar year.