Challenges Hindering Web3 Development in Ukraine
Date: 2023-12-13 Author: Dima Zakharov Categories: IN WORLD
Challenges Faced by Web3 Entrepreneurs in Ukraine
The Ministry of Digital Transformation of Ukraine has highlighted the primary challenges facing the development of Web3 technologies in the country. These issues are impeding the growth of startups in the Web3 sector.
Lack of Legal Framework
One of the major hurdles is the absence of comprehensive legal regulations for the cryptocurrency industry in Ukraine. Currently, there is no updated version of the "Virtual Assets" law in place. As a result, many Web3 startups are forced to register their businesses outside of Ukraine to operate legally.
Banking Restrictions
Web3 businesses also face significant challenges due to limited access to banking services. The introduction of currency and hryvnia restrictions in connection with the military situation has made it difficult for companies to meet their financial obligations to partners.
Need for European Standards
Ukraine is urged to incorporate European norms, specifically MiCA, into its local cryptocurrency legislation. However, hastily implementing stricter requirements may lead to the migration of Web3 startups to other countries.
Alternative Legislation
To address these problems, the Ministry of Digital Transformation is promoting alternative legislative proposals related to virtual assets and taxation of cryptocurrency operations. These initiatives are expected to mitigate the aforementioned negative factors.
Strategic Importance of Web3
In light of the ongoing conflict, the development of new sectors in the digital economy is strategically crucial for Ukraine. The Web3 industry has the potential to drive technological and economic development in the country, bolstering its leadership in digitalization.
The Ministry of Digital Transformation will consider the results of its research when shaping future state policies in the field of the digital economy.
It is worth noting that in November, Ukraine announced the creation of a sandbox for Web3 projects, aiming to facilitate innovation in the sector.
Previously, ForkLog examined the specifics of legislative proposals put forward by the Ministry of Digital Transformation.
