Summary
- Ukraine, an early adopter of crypto, now has the world’s highest share of crypto users relative to population size.
- The authorities are developing legislation for the sector, aimed at local needs and EU membership rules.
- Significant risks remain magnified by the continuing conflict with Russia.
- Visit the Crypto in Action pages for more stories about how and why countries worldwide are adopting crypto and blockchain.
Why does Ukraine have such high rates of crypto adoption?
Ukraine has registered high crypto adoption rates for several years reflecting a potent combination of wider reasons.
The conflict with Russia has shaped its position on digital assets. When the central bank (the National Bank of Ukraine (NBU)) closed the financial borders following the Russian invasion, crypto usage marked a steep rise. Among its uses in the early days of the war was as a tool for swiftly delivering aid donations.
Crypto has proved attractive to a population that faces economic uncertainty, requires means to send and receive remittances, is technically literate and has some measure of distrust of traditional financial institutions.
As a result, Ukraine now has the world’s highest levels of crypto activity relative to the size of its population. That said, adoption rates have slowed. In 2023, Ukraine was ranked in the top five globally in terms of adoption, but its placing dropped to eighth in 2025.
What is the authorities’ attitude towards the sector?
Ukraine’s administration under President Volodymyr Zelenskyy has been notably committed to the country’s digital transformation, and the development of the crypto and blockchain sector can be regarded as part of this framework.
The authorities have seen value in crypto, particularly to help support the war effort, and it’s notable that Ukraine has one of the world’s largest holdings of bitcoin, worth an estimated $5.6 billion, which ranks it behind only the US, China and the UK.
The authorities have, however, also taken a relatively strict line on cryptocurrency usage. They regularly cite their support for advancing legislation, but at the same time, also stress that there are no plans to allow cryptocurrencies to function as legal tender.
NBU Governor, Andriy Pyshnyy, has said that the authorities “must provide the market with legal protection” and that legislative action is designed to safeguard monetary stability, protecting the role of the fiat, the hryvnia, in the economy and blocking possible avenues for illicit financing.
Notably, a bill was introduced in June 2025, which – if passed – will allow Ukraine to create a federal bitcoin reserve. Bill no. 13356, which proposes amendments to the legislation relating to the NBU, would authorize the central bank to acquire cryptocurrencies alongside gold and foreign currencies. There is, however, a provision that leaves this decision to the NBU, rather than making it legally binding.
Set against this positive outlook are challenges. The sector offers no tax revenue for an economy struggling with the costs of war. It is estimated that the authorities have foregone at least $200 million in tax revenue from crypto exchanges and virtual asset service providers (VASPs) alone in the past four years.
Criminals have also taken advantage of the situation; in March 2025, it was reported that a $13 million international crypto mining scam had been uncovered, in which several Ukrainian suspects were being detained for their alleged involvement along with a number of EU counterparts.
Russian saboteurs have also taken advantage of the situation, some of them orchestrating ‘money mule’ schemes where they offer to buy bank accounts from Ukrainian citizens with financial problems, which they then use to launder money.
UK think tank, the Royal United Services Institute (RUSI), estimates the cost of unrealized tax revenue and stolen funds to be at least $10 billion.
In better regulating the space, the authorities are aiming to not just combat illicit activity but also better protect consumers.
Danylo Hetmantsev, head of the parliamentary tax and finance committee, has made this point, arguing for the market’s legal protection, stating that: “The state must recognize those who own crypto and exchanges that carry out this activity. It must give the owners the opportunity to protect their rights because you cannot help but notice it’s too big to ignore.”
What are the proposed legislative changes?
Crypto legislation was first tabled in 2022, just before the Russian invasion. The law has never been implemented because parliament needs to first pass virtual asset taxation legislation. This reportedly has to be completed by the end of 2025 as part of the country’s wider EU and International Monetary Fund (IMF) obligations.
This is important. In part, a key reason for pursuing crypto legislation is Ukraine’s EU-membership application. The country is seeking to become a member state by 2030, but among other things, needs to bring its own legislation in line with that of the bloc before it can do so.
Currently, another bill – On Virtual Asset Markets – is going through parliament. This seeks to legalize digital asset ownership, without recognizing cryptocurrencies as legal tender, a formula that many other jurisdictions have adopted. It will also align with the EU’s standards on transparency, consumer protection, licensing and areas like anti-money laundering (AML) and know your customer (KYC).
The draft bill has a provision allowing Ukrainians who already own digital assets to declare these before the legislation comes into effect. If they do so, they will pay a reduced tax – a one-time 5% military tax and just 5% personal tax. Following the first year, the rate will increase to 18%.
Timeline of crypto developments
2016
The NBU began exploring the idea of issuing a CBDC – the e-hryvnia.
2018
From February to December, the NBU conducted a pilot study into the creation of the e-hryvnia.
2019
Presiden tZelenskyy assumed the office, committing from the outset to a digital strategy. As part of this, digital development came under the Ministry for Digital Transformation, and the position of Chief Digital Transformation Officer was created for each government agency.
2021
The parliament passed its first reading of the Virtual Assets Law (bill no. 3637), which provided the basis for licensing, oversight and taxation.
2022
The parliament passed the Virtual Assets Law, which was then signed by the president.
2025
In April, the draft law, On Virtual Asset Markets (No. 2074-IX), was tabled, passing its first reading in September. The parliamentary committee on Finance, Taxation and Customs Policy, recommended adopting it on the first reading, along with revisions to the tax code.
In June, bill no. 13356 proposed amendments to legislation related to the central bank, calling for the bank to be given the option to stockpile crypto assets as well as gold and foreign currencies.
In August, the NBU issued a warning against unlicensed exchanges. It argued that unauthorized payments could potentially put the country’s banking and payment systems at risk.
In September, the parliament passed the first reading of draft law no. 10225 (tax code amendments), which proposes changes to the tax code to include the taxation of virtual assets.
Ukraine seeks middle ground
Like many countries experiencing high rates of crypto adoption, Ukraine’s authorities are seeking middle ground between legislating to provide much-needed oversight while also wanting to ensure that the sector develops healthily. In addition, Ukraine continues to grapple with war as well as its wider EU-membership plans. Framed in this context, legislation is required – not least to unlock the taxation benefits for the authorities from the sector – but also to address the criminal element that is taking advantage of and subverting the crypto sphere. Given the country has five years to secure its membership of the EU bloc, legislation can be expected to stay on track as Ukraine works to meet requirements.
