Ukraine has begun formal steps to legalize the crypto industry, shifting from a largely unregulated market to one with a defined legal status.

On Sept. 3, Ukrainian lawmaker Yaroslav Zhelezniak revealed that he and his colleagues approved a bill that legalizes and taxes the use of digital assets in the country.

According to him, the draft bill introduces a tax framework that makes transactions subject to an 18% income levy and a 5% military contribution.

To encourage compliance, the bill offers a one-year window during which withdrawals converted to fiat currency would be taxed at just 5%.

He added that regulators for the space have yet to be named, with both the National Bank of Ukraine and the National Securities and Stock Market Commission being considered.

Meanwhile, he pointed out that new revisions would be made to the bill before the second reading.

Ukraine’s crypto industry

The legislative move comes as Ukraine faces mounting pressure to bring its crypto sector under tighter oversight.

A recent study by the Royal United Services Institute (RUSI) suggested the country could recover up to $10 billion by building a more robust regulatory system.

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According to the report, the country’s thriving over-the-counter markets have become a focal point for illicit financial flows, including purchasing restricted military components, using money-mule networks, and gaps in donor verification rules.

The report linked these weaknesses to broader geopolitical risks, warning that they create opportunities for foreign actors to launder money into politics and undermine democratic systems.

Experts at the institute also cautioned that Russian intelligence may be exploiting Ukraine’s wartime distractions to channel illicit funds through local intermediaries.

Considering this, the report argued that Ukraine risks being perceived as a hub for crypto-based money laundering without stronger oversight, which would damage its financial stability and international partnerships.

The report comes at an exciting time, as Ukraine ranks among the world’s most active crypto users. Data from Chainalysis placed the country in the global top ten for adoption and first in Eastern Europe.

That high level of retail and institutional activity has given lawmakers added urgency, as crypto regulation is now seen as necessary to capture tax revenue and shield the economy from illicit activity.

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Most Japanese say they would buy more Bitcoin (BTC), Ethereum (ETH), and altcoins if the government agrees to reform the nation’s strict crypto tax rules.

This was the main takeaway from a survey of 1,500 adults conducted in April and commissioned by the Japan Blockchain Association (JBA).

Japanese Crypto Tax Reforms Would Drive Volumes Up, Says JBA

In response to the question: “Do you own BTC or other cryptoassets?” 13% of respondents responded in the affirmative.

However, their response to the follow-up question was telling. The question was: “Would you buy crypto/more crypto if the government were to set a flat 20% tax rate on crypto profits?”

To this, 84% of the 191 respondents who said they hold crypto answered “yes.”

And 12% of the 1,309 non-crypto holders also agreed that they would start buying coins if Tokyo green-lights tax reforms.

Capital Gains Tax Request

The JBA suggested that the survey shows that tax reforms would have a very noticeable effect on the trading volumes of domestic exchanges.

At present, Japanese investors must declare their crypto-related profits on income tax returns, in the “other income” category.

That means that depending on their tax brackets, crypto investors may have to pay taxes of up to 55% on their profits.

In many other nations, crypto is instead subject to capital gains tax. That means that, after a certain threshold, traders are taxed at a flat rate of (typically) 10-20%.

Reform advocates want Tokyo to approve a plan to scrap crypto income tax laws. In their place, they want a flat 20% capital gains levy.

The JBA supports this proposal, as do many key members of the ruling Liberal Democratic Party, in addition to opposition lawmakers.

However, the regulatory Financial Services Agency (FSA) effectively has the final say on all Japanese crypto policy.

Thus far, all of the FSA recommendations to the Cabinet have been enshrined into law.

The association said: “Cryptoassets are changing from a means of payment for the public to a means of asset accumulation.”

This is in line with the FSA’s own plans to reclassify crypto as a payment tool to an investment vehicle.

The industry body says it is “stepping up its efforts” to convince Tokyo to approve tax reform starting next year.

The JBA is an industry group that comprises some of the nation’s biggest crypto exchanges and blockchain firms.

JBA Submits Petition

The association also announced on July 18 that it has submitted a petition to the FSA calling for it to approve tax reform for crypto profits.

The survey was conducted on April 24 and April 25 this year. Respondents were all Japanese residents aged 20 to 69. Respondents were 60% male and 40% female, with an average age of 38.

The JBA also asked further questions. And 75% of respondents said they would prefer tax bodies to withdraw their payable taxes at source, rather than make separate tax declarations.

The JBA has also asked Tokyo to let crypto traders choose how they want to pay taxes: at source when they sell coins, or after filing declarations.

The survey’s authors also asked the respondents who do not currently hold any coins why they have not invested yet.

To this, 8% of respondents said that they thought that tax levels were too high. But 61% said they thought they lacked sufficient understanding of crypto.

The Japanese media outlet CoinPost reported that the FSA is now “deliberating a proposal to transition cryptoassets to the framework of the Financial Instruments and Exchange Act.”

“If the transition is approved, cryptoassets will be officially classified as financial products,” the media outlet explained.

Most of the respondents said they work in the private sector. Students made up 5.3% of the respondent pool. And 213 unemployed individuals also submitted responses.

At the time of writing, ETH trading accounts for almost half of the trading volume on bitFlyer, one of the nation’s biggest crypto exchanges.

Paul Atkins, former SEC Commissioner and President Donald Trump’s nominee to chair the US Securities and Exchange Commission (SEC), appeared before the Senate Banking Committee on March 27, vowing to restore clarity and restraint to the agency’s regulatory agenda.

A key focus of his testimony was the need for coherent rules governing digital assets, which he described as a pressing challenge for both innovation and investor protection.

Atkins criticized aspects of former SEC Chair Gary Gensler’s tenure, highlighting concerns over federal courts overturning rulemaking initiatives, increased staff attrition, and controversial enforcement actions against cryptocurrency firms.

He advocated for a shift towards deregulation, emphasizing the need for clear and effective rules that promote innovation while safeguarding market integrity. He pledged to return the agency to its core mission of protecting investors, promoting efficient markets, and facilitating capital formation.

Concerns over conflicts, crypto past

During the confirmation hearing, Senator Elizabeth Warren sharply questioned Paul Atkins over his connections to the cryptocurrency industry and financial firms.

In a letter submitted ahead of the hearing, Warren questioned whether Atkins could remain impartial given his consulting ties to the industry, particularly his role advising FTX before its collapse.

She also raised concerns about his personal financial disclosures, which show substantial holdings linked to the crypto sector totaling roughly $6 million.

Warren urged Atkins to commit to recusing himself from any future matters involving his former clients and to avoid returning to the financial industry for at least four years after serving. She emphasized that such steps were necessary to restore public trust in the SEC’s independence.

Paul Atkins responded to Senator Warren’s questioning by emphasizing his commitment to ethical standards and full transparency. He assured the committee that, if confirmed, he would divest from all financial holdings that could present a conflict of interest, including crypto-related assets and his consultancy, Patomak Global Partners.

He also stated that he would comply with all federal ethics rules and SEC protocols regarding recusals. While he stopped short of committing to a formal post-service employment ban, Atkins maintained that his decisions would be guided solely by the public interest and the SEC’s statutory mandate — not by prior affiliations.

Atkins positioned his private-sector experience as an asset, arguing that it gave him the insight needed to craft effective regulations without stifling innovation. He rejected the notion that his past work compromised his ability to lead impartially, saying it instead equipped him to understand the real-world impact of the agency’s rules.

He also promised to probe the FTX collapse further and ensure that the SEC looked into the matter thoroughly in response to concerns raised by Senator Chris Van Hollen.

Charting a new course

Looking ahead, Atkins said one of his top priorities would be working with fellow commissioners and lawmakers to craft a regulatory approach to digital assets that is principled, structured, and technology-neutral. He said the current lack of clarity has led to confusion and discouraged innovation.

He argued that with appropriate rules in place, the US could solidify its leadership in financial innovation and attract global investment. Atkins also signaled his opposition to what he described as “overly politicized” rulemaking and called for the SEC to focus on its statutory obligations rather than advancing partisan agendas.

With the SEC at a crossroads, Atkins’ nomination is expected to shape the agency’s direction on issues ranging from crypto markets and ESG disclosure to enforcement priorities and market structure reforms.

The Senate committee will continue its evaluation before voting on whether to advance his nomination. If the committee votes in favor, the nomination proceeds to the full Senate for a confirmation vote. There, a simple majority is needed for final confirmation.

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