Ukraine Chooses Stellar Foundation to Develop Its CBDC, Regulatory Infrastructure for Stablecoins

The Ministry of Digital Transformation of Ukraine has picked the Stellar Development Foundation (SDF) to develop its central bank digital currency project (CBDC).

Ukraine Picks Stellar Foundation to Develop Its Central Bank Digital Currency and National Virtual Asset Strategy

According to the official announcement, both parties signed a “Memorandum of Understanding” to deploy Ukraine’s crypto strategy. The National Bank of Ukraine has been exploring CBDC’s for some time, there are reports on the matter since 2016.

The agreement will also strengthen the country’s ongoing efforts to develop a legal framework for the crypto industry in the nation and build an infrastructure for such purposes.

Oleksandr Bornyakov, Deputy Minister of Digital Transformation for IT Development of Ukraine, commented on the goals the government targets with the Stellar deal:

Another important aspect of this cooperation is contributing to the development of the infrastructure for a Ukrainian national digital currency. Most of the world’s leading countries are developing their own national digital currencies. (…) It demonstrates Ukraine’s movement towards one of major financial trends. At the Ministry, we aspire to ensure our country’s adaptation to technological innovations and competitiveness in the financial market in Eastern Europe.

The memorandum outlines a “cooperation on the development of the virtual assets market in Ukraine,” “provision of support to projects related to virtual assets,” plus the “facilitation” to make possible a CBDC in the country.

Denelle Dixon, CEO of the Stellar Development Foundation, said:

We look forward to working with the Ministry and other stakeholders to digitize the hryvnia, to bring Stellar-based tools and services to the people and businesses of Ukraine, and to introduce new partnership opportunities in Ukraine to businesses in the Stellar ecosystem.

Both the Ministry and the SDF will start to work on the project already this January, which also involves implementing regulation for stablecoins in Ukraine.

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Latest Efforts of Kyiv to Regulate National Crypto Environment

Legalizing cryptocurrencies remains a priority in Kyiv as the government has indicated its clear understanding that the benefits outweigh the risks.

Early in 2020, the then-Finance Minister Oksana Markarova announced that operations conducted by crypto companies and other entities dealing with digital assets would be examined and verified by Ukraine’s financial regulators.

What do you think about the deal arranged between Ukraine and Stellar Foundation? Let us know in the comments section below.

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