Ukrainian authorities will be able to “block crypto wallets” in order to seize illegally obtained assets, a notice on the country’s Ministry of Finance says.

Oksana Markarova, Ukraine’s Finance Minister, reportedly said that the State Financial Monitoring Service of Ukraine (SFMS) will be the responsible authority for tracking the sources of origin of the funds on citizens’ crypto wallets.

Authorities use an analytical product scanning for the crypto funds’ origins and uses

As part of the regulatory policy, the SFMS will be able to not only find out the origin of crypto, but also detect how those funds have been spent, Markarova said in a Jan. 23 report placed on the official website of Ukraine’s Finance Ministry.

Markarova, who has been serving as Ukraine’s Finance Minister since late 2018, initially told the news in an interview with local business publication MC.today. The text of the report on Ukraine’s Finance Ministry website is basically a copy of the original report on MC.today.

Specifically, the SCFM claims to have access to an “analytical product” that purportedly allows investigators to look at the origins of crypto assets as well as their uses. According to Markarova, there have been a number of “successful cases” of investigations via the service.

Blocking crypto wallets is possible as a “result of complex investigations”

Markarova elaborated that halting crypto transactions is impossible, while blocking wallets is possible through private keys:

“It is impossible to stop operations now, but it is possible to block crypto wallets and remove illegally obtained crypto assets. This can be done by gaining access to the crypto's private keys as a result of complex investigations.”

Cointelegraph asked the SCFM about their capabilities in blocking crypto wallets of Ukrainians but did not receive an immediate response. This story will be updated should they respond.

Action is part of the AML regulation approved by the Ukrainian government in late 2019

According to the statement, the new responsibility of the SCFM will be part of a new crypto-related law that was approved by the Ukranian government in December 2019.

On Dec. 6, the Verkhovna Rada, the parliament of Ukraine, published a final version of a money laundering law that will handle virtual assets and virtual asset service providers per guidelines of the Financial Action Task Force (FATF). The document says that cryptocurrency transactions are among operations that have to be monitored by relevant authorities.

As part of the new law, all crypto transactions up to 30,000 Ukrainian hryvnia ($1,300), will reportedly have to be accompanied with Know Your Customer identification and information on the nature of the business relationship between the payer and payee. Additionally, the new law will reportedly come into force on April 24, 2020.