Ukraine's central bank has declined to back a crypto market bill that a parliamentary committee advanced toward a final vote, arguing that the draft leaves foreign tokens functioning as electronic money outside its control and risks the country's monetary sovereignty.

In a statement published on Nov. 4, the National Bank of Ukraine (NBU) said Draft Law No. 10225-d on the circulation of virtual assets — which the Verkhovna Rada Committee on Finance, Tax and Customs Policy recommended for adoption in the second reading and as a whole — fails to reflect the compromises reached during drafting.

According to the central bank, it received the final text only late the evening before the committee vote, and the process "was not sufficiently transparent." Deputy Governor Oleksii Shaban raised the bank's objections at the committee meeting, but the NBU said the format did not allow a full debate.

Ukraine already legalized a framework for virtual assets in 2022. The new bill is intended to place that market under detailed rules modeled on the European Union's Markets in Crypto-Assets regulation (MiCA) and on International Monetary Fund recommendations — a direction the NBU says it supports in principle.

Three risks flagged by the central bank

The bank's public case rests on three points.

First, the draft would allow foreign tokens into Ukraine even when they function as electronic money yet face no comparable supervision in the countries where they are issued. The NBU said this threatens monetary sovereignty, the transmission of monetary policy, payment infrastructure and financial stability. The bank is seeking the same powers it holds over domestically issued tokens: the authority to assess foreign assets and, where necessary, restrict their circulation within Ukraine.

Second, the NBU argued that simplified admission of foreign virtual assets must not allow them to sidestep the rules that apply to comparable Ukrainian assets. Without such parity, it warned, segments of the market could expand outside adequate oversight and create regulatory arbitrage.

Third, the bank flagged monopolization and corruption risks in how the National Securities and Stock Market Commission would authorize trading-platform operators. The NBU initially opposed numerical caps, then agreed as a compromise to limit the first wave to three legal persons chosen through competitive selection. According to the central bank, the final draft drops a clear five-year cap and leaves the number of operators to the securities commission's discretion without sufficient antitrust safeguards.

What happens next

The committee's Nov. 4 recommendation does not enact the law. A final Verkhovna Rada vote is expected later in November. If adopted, the rules would take effect on July 1, 2027, Interfax Ukraine reported, splitting supervision between the NBU and the securities commission.

Under the committee version, personal income from virtual-asset trades would be subject to Ukraine's standard personal income tax, with a reduced 5% rate through the end of 2028 for assets acquired before the law takes effect. Crypto-to-crypto exchanges would not be taxed, and virtual-asset transactions would fall outside VAT.

The dispute unfolds as Ukraine continues to debate how deeply bitcoin and other digital assets should be woven into state finances. Lawmakers last year introduced a separate bill that would allow the NBU to hold virtual assets, including bitcoin, in its foreign-exchange and gold reserves — a permission the bank would not be required to use.

"The development of the virtual asset market and the protection of monetary and financial stability are not mutually exclusive," the NBU said. It called on members of parliament to refine the document with all parties to the process and said it remains ready to cooperate.

The question now is whether Ukraine's lawmakers reopen the foreign-token and licensing clauses before a floor vote, or push the committee text through and leave the central bank on the outside of a framework it helped draft.

This article first appeared on Bitcoin Magazine and was written by Micah Zimmerman.