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Legal support for the mining of cryptocurrencies

Legal support for the mining of cryptocurrencies

Mining comes from the English word "mining", which means "extraction". Accordingly, the miners of digital currencies are called miners. Essentially, mining is the maintenance of a distributed platform and the creation of new blocks in the block chain (blockchain), with the possibility to receive remuneration in the form of new units and commissions in various cryptocurrencies. Calculate mainimage equipment required to protect the network from repeated spending of the same units (so-called double-spend), and the reward encourages people to spend their computing power and to support the work of networks. Mining today is not just the Foundation of a new cryptoeconomy, but also profitable and high margin business.

However, not all prefer to engage in mining legally. Some people mistakenly believe that in the absence of national legislation a definition of cryptocurrency and mining, there is no legal framework for the legal management of such kind of entrepreneurial activities. Others believe that, taking into account the position of the Central Bank and financial monitoring considering cryptocurrencies as a substitute for money, the circulation of which is prohibited, mining is an illegal activity. However, the first and second judgment about are presented. Provision of services for the provision of computational power and solution algorithms, using our own equipment further creation of new units in any way not prohibited by applicable Ukrainian law.

Thus, in the absence of appropriate and timely legal action, mining business can have serious legal risks. Despite the absence of specific regulatory requirements for the organization of mining mines and farms, organizers of mining could face criminal liability under the criminal code of Ukraine - illegal entrepreneurship, tax evasion, and other administrative responsibilities (if the damage amount/income in a smaller size than necessary for the UK) and the loss of expensive mining equipment.

Mining cryptocurrency today is of several types: a proof-of-stake mining, proof-of-work mining, utility, industrial, mining, cloud mining, solo mining and mining pools, bitcoin mining with GPU and mining with Asic miners type L3+. Bottom today as Bitcoin and Etherium, Dash, Litecoin and many other altcoins. Depending on the kind of mining there are various organizational-legal patterns of execution. But whatever was mining, he obviously aimed the organizers for the sole purpose to generate profit in cryptocurrencies and its subsequent implementation over the Fiat money.

So the miner needs a clear legal scheme in order not to have problems with law enforcement and legal to receive income in the form of dividendos from mining activities.

Service description:

business registration;

statement on balance of mining equipment;

preparation of recommendations on accounting of crypto-currencies as intangible assets;

development of civil contracts for the implementation of the resulting cryptocurrency;

consulting on the procedure of taxation of mining.

The exact amount of necessary actions for the project are determined after studying the documentation, and business scheme of the project as well as consultation with the Customer.

The national Bank of Ukraine officially considers "virtual currency/cryptocurrency" as a substitute for money without providing real value. Hence the impossibility to use the specified units of physical and legal persons on the territory of Ukraine as means of payment.

In addition, the national Bank, during the use of "virtual currency/ cryptocurrency" Bitcoin there is a serious threat - high-risk factor associated with by the operation, is the anonymity (and the operation among other things, may include cash), the decentralization implementation.

NBU draws attention to the fact that all risks for use in the calculation of "virtual currency/cryptocurrency" Bitcoin are borne solely by the participant in settlement thereof. At the same time, with itself as the regulator of the financial services market in the country, the national Bank takes responsibility for possible risks and losses associated with the use of the system of charges.

You should also consider the joint statement of the National Bank of Ukraine, the National Commission on securities and stock market National Commission carrying out regulation in the sphere of financial services markets

We, the national Bank of Ukraine, the national Commission on securities and stock market national Commission carrying out regulation in the sphere of financial services markets, are convinced that the complex legal nature of cryptocurrency does not allow to recognize them either in cash or currency and means of payment of another country or monetary value or electronic money, no securities, no cash substitute.
We do, however, financial regulators in Ukraine, we continue the study of the question of the legal status of cryptocurrencies and legislative settlement of transactions with them, taking into account the position of regulators in other countries and recent trends in the development of such technologies. The purpose of this resolution is to protect the rights of consumers, combating money laundering and other illegal actions, identification of entities of operations (financial monitoring), the taxation of income received, Declaration and the like.
At the same time warned that any activities related to the operations of purchase, sale, exchange and conversion into cryptocurrency, carries a large number of risks, physical and legal persons should be aware of before making cryptocurrency transactions. All who are planning to invest your own money in cryptocurrencies need to be aware of, engaged in such operations at your own risk.