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Ukraine Introduces ‘Sound’ Crypto Mining Regulatory Policy
Ricardo Martinez | Feb 08, 2020 | 13:00
Ukraine has just announced the most forward-thinking crypto-mining regulatory policy in the world.
Ukraine is Positioning Itself to be a Global Leader for Crypto
Ukraine’s Manifesto of the Virtual Assets Ministry, Ministry and Committee of Digital Transformation of Ukraine, has just released the sanest and sound crypto-regulatory policy for Public Blockchains and Proof of Work (PoW) mining on earth.
The regulatory ministries have concluded that Bitcoin’s protocol and enforced consensus rules are enough to regulate the onchain activities, as the network’s rules are enforced by the protocol itself, node operators and social consensus of users themselves. It does not need government oversight or intervention.
Ukranian officials understand that blockchain technology is self-regulating due to its use of open-source protocols, and open network access which allows privacy and free movement of assets, secured by a decentralized network, cryptography, PoW, and social consensus.
Instead of micro-management and egregious regulatory demands, Ukranian officials are focusing on developing state policy in the field of digitization, digital economy, digital innovation, e-governance and e-democracy, and the development of information society.
Ukraine’s regulatory policy is trying to jumpstart participation in the development of virtual assets, blockchain and tokenization, artificial intelligence, and other tech innovations.
The US is Losing Position as Technology Innovator
This is a breath of fresh air and shows that Ukranian officials actually understand permissionless and open public blockchains.
Most crypto regulations are laughably stupid attempts to micromanage the self-regulating activities of using public blockchains, with antiquated holdover strategies from the legacy financial system.
A great example of this type of stupid regulation is Fincen’s travel rule for crypto businesses. It does nothing but creates costs and regulatory burdens for startups. It doesn’t even stop the money laundering and crime it claims to prevent. AML/KYC has been proven to be ineffective and poses a giant security risk when businesses have to store sensitive data for clients. These sensitive databases are always targets for hackers.
Ukraine should be lauded and applauded for taking such a leadership stance, and not stifling innovation. The US state of Seattle is another example of enacting stupid regulations specifically aimed at charging miners more for electricity and implementing industry strangling bureaucratic demands on mining startups.
Perhaps the worst example of regulatory abuse is NY’s Bitlicense, a piece of regulation so overbearing it has caused startups to avoid the state entirely and call it a hostile climate to innovation.
What do you think about Ukraine’s new pro-crypto mining policy? Let us know in the comments!
Image via Shutterstock
