On October 6, the office of Volodymyr Zelensky, president of Ukraine, returned to Parliament a bill that would establish a comprehensive regulatory regime for digital assets.
The primary issue that the president's office had was the establishment of a new regulatory body for crypto, which would be expensive:
"The creation of a new body, as provided by this law, will require significant expenditures from the state budget. Therefore, Volodymyr Zelensky proposes to include the regulation of the circulation of virtual assets in the competence of the National Securities and Stock Market Commission."
The National Securities and Stock Market Commission is Ukraine's equivalent of the U.S. Securities and Exchange Commission but is itself fairly underfunded. As of 2019, the most recent year of published data, the commission's budget was just over 135 million hryvnya — at current exchange rates, roughly $5 million USD.
The Verkhovna Rada, Ukraine's parliamentary body, had approved its version of the bill on September 8. The country has been working on a formal regime to legalize cryptocurrencies for years at this point.
Despite that legislative uncertainty, crypto holds a notable position in Ukraine. The push to become a hotbed for crypto is a means to overcome stagnant investment, both foreign and domestic, into Ukrainian firms. However the country's history with corruption and capital flight — most recently exemplified by appearances of Zelensky and his inner circle the Pandora Papers' exposé of offshore vehicles — could undermine faith in the country's crypto initiatives.