The use and circulation of cryptocurrencies has long become part of the daily life of many individuals and legal entities, who use them for one reason or another, pursuing various goals. Therefore, sooner or later, questions arise both about the very nature of cryptocurrencies, and about how states, in the form of relevant authorities, should respond to their use and circulation. After all, cryptocurrencies actually replace fiat and electronic money in commodity circulation, when making payments for goods, works, and services. Moreover, cryptocurrencies themselves are increasingly becoming commodities. All of this indicates that there are urgent questions regarding the appropriate, proper and necessary legal regulation of various manifestations and aspects of social relations related to the circulation and use of cryptocurrencies, regarding the limits of such regulation.

The purpose of the article is an attempt to determine guidelines for the possible regulatory regulation of certain aspects of social relations related to the circulation and use of cryptocurrencies (in particular, accounting and taxation), taking into account the already existing regulatory framework.

It has been established that cryptocurrency, being a synonym or a type of virtual assets, is an intangible good – information (a set of data) in a digital/electronic expression/format/appearance, acts as an object of civil legal relations, can be used as a means of payment, a transfer tool, investment and etc., while having value and expressing it.

It is acceptable to attribute cryptocurrencies to the income of individuals or to the income of legal entities. Subclauses 14.1.54 and 14.1.55 of Clause 14.1 of Article 14 of the Tax Code of Ukraine, which contain provisions on income originating from Ukraine and from sources outside Ukraine, need to be amended by supplementing them with an indication of virtual assets (cryptocurrencies). Article 134 of the Tax Code of Ukraine needs to be amended in the form of an addition to its provisions on virtual assets (cryptocurrencies). The basis of taxation in relation to cryptocurrency should be considered its value, as a value expression of the object of taxation. According to national accounting regulations (standards) and international financial reporting standards, cryptocurrency belongs to the so-called “intangible assets”. Determination of the tax base to which the personal income tax rate should be applied can be carried out according to the official rate of the National Bank of Ukraine.

Bibliography

Authored books

1. Andrushchenko V, Tuchak T, Podatkovi systemy zarubizhnykh krain: navch. posib. (Un-t DFS

Ukrainy 2021).

2. Kud A, Kucheriavenko M, Smychok Ye, Tsyfrovi aktyvy ta yikh ekonomiko-pravove

rehuliuvannia u svitli rozvytku tekhnolohii blokchein (Pravo 2019).

Journal articles

3. Polatay V, Ovcharenko A, Bondarenko I, Gavkalova N, ‘Crypto currencies in the system of

international private monetary law. Some issues of virtual assets taxation and accounting in

Ukraine’ [2020] 41(08) Revista Espasios 22.

Newspaper articles

4. Greenberg A, ‘Crypto Currency’ (Forbes. Apr 20, 2011) <https://www.forbes.com/

forbes/2011/0509/technology-psilocybin-bitcoins-gavin-andresen-crypto-currency.

html?sh=32ce2680353e> (accessed: 30.04.2024).

5. Phillips D, Graves St, ‘What Is the Bitcoin Genesis Block? How It All Started’ (Decrypt

Media, Apr 30, 2024). <https://decrypt.co/56934/the-bitcoin-genesis-block-how-it-allstarted>

(accessed: 30.04.2024).