The Economic Security Bureau of Ukraine is conducting a pretrial investigation against local crypto trading platforms suspected of tax avoidance.
Ukraine’s Economic Security Bureau (ESB) is investigating local crypto exchanges after the bureau found that non-regulated exchanges operating in the country cost over $80 million in lost taxes.
In an interview with Forbes Ukraine, ESB head Andriy Pashchuk said the investigation is being conducted only against trading platforms whose beneficiary is a citizen of Ukraine. He revealed that analysts at ESB are using data services like Chainalysis and Crystal Blockchain to trace all crypto operations.
“Currently, the bureau is conducting a pretrial investigation against entities that are participants of the [local] cryptocurrency market.”
Andriy Pashchuk, Ukraine’s ESB head
Besides on-chain data, ESB also relies on OSINT insights to estimate the total crypto turnover in digital wallets on Ukrainian crypto exchanges. Pashchuk declined to detail at what stage the pretrial investigation is at.
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In August 2023, ESB issued an official statement. It said Ukrainian crypto exchanges amassed $445 million in trading fees over the past ten years. As per the bureau’s calculations, domestic trades with Bitcoin (BTC), Ethereum (ETH), and Tether (USDT) amounted to a total volume of more than $55 billion from 2013 to 2023,
The bureau believes that unregulated activity of cryptocurrency exchanges in Ukraine cost the country’s budget around 3 billion Ukrainian hryvnia (around $81.2 million as of press time). However, ESB accused no particular exchange of any wrongdoing so far.
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