The National Bank of Ukraine talks about the legality of Bitcoin

Back in the second week of August 2017, an interesting event took place in Ukraine, as several individuals were reportedly arrested for being involved in illegal bitcoin mining activities. To put things better into perspective, during a raid carried out at the Paton Electric Welding Institute, which happens to be state-owned, the Ukrainian police found a total of 200 computers set up to mine bitcoin in an unused swimming pool, situated in the institute’s campus.

This has led to some confusion in the country, as people did not understand whether or not mining bitcoin was considered illegal, and why the individuals were arrested. The National bank of Ukraine, commonly referred to as the NBU, since then has issued a statement about bitcoin. The statement captured the current regulations covering it alongside the legal status of digital currencies in the European country.

In the statement, the NBU went ahead and clarified that at this moment in time, only one currency can be used in Ukraine, the Hryvnia. Therefore, no other currency is to be used as a form of payment. Regardless of this aspect, the NBU also went ahead and claimed that currently, the status of Bitcoin inside the country remains complicated, as there are little to no regulations surrounding it and a lack of global effort to actually classify and regulate the cryptocurrency. The report stated that, in different countries, Bitcoin can be classified in a number of ways, ranging from virtual money, virtual assets, money surrogates, virtual goods and more- so far, the NBU has not selected a definition to support.

A few lawyers have stated, however, that mining bitcoin in Ukraine is NOT against the law. The arguments brought forward by the NBU are a warning, not laws, meant to interdict the use of digital currencies, and their mining. Most likely, in the case of the arrest mentioned at the beginning of the article, the individuals may have been arrested for illegally setting up a mining rig in a state-owned property, without asking for approval first, and without having any financial documents.

Based on everything that has been outlined so far, what do you think about the lack of clarity regarding the legal status of bitcoin and other digital currencies in Ukraine? Let us know your thoughts in the comment section below.

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