A notice from the Ministry of Finance of Ukraine states that Ukrainian authorities will be able to "block the cryptocurrency wallet" in order to confiscate illegally acquired assets.
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According to reports, Ukrainian Finance Minister Oksana Markarova said that the State Financial Supervisory Service (SFMS) of Ukraine will become the responsible agency for tracking the source of citizens' crypto wallet funds.
Authorities use analytics product scans to understand the origin and use of cryptocurrencies
In a report published on the official website of the Ministry of Finance of Ukraine on January 23, Markarova said that as part of the regulatory policy, SFMS will not only be able to identify the source of cryptocurrencies but also detect how these funds are used.
Markarova, who has been Ukraine's finance minister since the end of 2018, initially told the news in an interview with local business journal MC.today. The text of the report on the Ukrainian Ministry of Finance website is basically a copy of the original report on MC.today.
Specifically, SCFM claims to have access to an "analysis product" that is said to allow investigators to see the origin of crypto assets and their uses. According to Markarova, many "successful investigations" were conducted through the service.
After "complex investigation", it is possible to block crypto wallets
Markarova elaborated that blocking crypto transactions is not possible, while blocking wallets with private keys is possible:
"It is not possible to stop operations now, but it is possible to block crypto wallets and delete illegally acquired crypto assets. Due to complex investigations, this can be done by accessing the private key of the cryptocurrency."
Cointelegraph asked SCFM about their ability to block Ukrainians' crypto wallets, but did not immediately receive a response.
Action is part of anti-money laundering regulations approved by the Ukrainian government in late 2019
According to the statement, SCFM's new duties will be part of a new crypto-related law approved by the Ukrainian government in December 2019.
On December 6, Verkhovna Rada of the Ukrainian Parliament issued the final version of the anti-money laundering law, which will deal with virtual assets and virtual asset service providers in accordance with the provisions of the Financial Action Task Force (FATF). The document states that cryptocurrency transactions are one of the operations that must be monitored by relevant agencies.
As part of the new law, all crypto transactions up to 30,000 Ukrainian hryvnias ($ 1,300) are reportedly required to be accompanied by a "know your customer" logo and the nature of the business relationship between the payer and payee Information. In addition, it is reported that the new law will enter into force on April 24, 2020.