Ukrainians are protecting their wealth using crypto as it resists Russian invasion.
As Ukraine defies Russia’s full-scale invasion, international sanctions begin to stifle the Russian economy, Russian President Vladimir Putin has resorted to nuclear saber-rattling, and world markets have swung back and forth. On Monday, for the first time since 2014, the oil prices reached over $100 per barrel; the Russian Ruble has lost 30% of its value versus the US dollar, plunging to new lows. The Ukrainian government has included cash withdrawal of about $3350 per day as an emergency economic measure; thus, the government, citizens, and the newspapers are seeking crypto aid. In this time of crisis, let’s explore how crypto can assist.
- More than $30 million in cryptocurrency have been raised by Ukraine after tweeting an appeal for donation on Saturday. Wallet address for Bitcoin, Ethereum, and USD-pegged stablecoin Tether (which experienced such a high demand on Ukraine’s cryptocurrency market, Kuna, that it traded above its peg, reaching $1.10 per coin) was shared from the official Twitter accounts of the government and Vice Prime Minister Mykhailo Fedorov. The question arises why crypto donation? Elliptic, a blockchain analytics firm, explained that since crypto like Bitcoin can easily be transferred to cross-border donation, it emerged as an alternative crowdfunding method.
- In a series of tweets, Vitalik Buterin, the Russian-Canadian Ethereum co-creator, severely condemned Moscow, describing the Invasion as a crime against Ukrainian and Russian people. In other news, on Tuesday, Uniswap added a tool allowing users to swap any crypto for Ethereum and send it across in a single transaction to the Ukrainian government’s wallet.
- Nadya Tolokonnikova, a founding member of the Russian pro-democracy punk band Pussy Riot, teamed up with PleasrDAO members to form UkraineDAO, which sold 10,000 Ethereum-based Ukrainian flags NFTs and plans to donate the entire proceeds (over $5 million) to the Come Back Alive Foundation, which supports Ukraine’s military, and the Proliska non-governmental organization. (If you’re thinking about donating cryptocurrency, be aware of scammers and do your homework beforehand.)
- An English-language newspaper, The Kyiv Independent in Ukraine, is seeking cryptocurrency donations in an attempt to support the country’s independent media. The Kyiv Independent listed Bitcoin and Ethereum wallets in addition to GoFundMe pages for the publication and many partners. Meanwhile, Arweave, a Berlin-based blockchain startup, seeks to preserve historical documents linked to the crisis; its network of 1,000 nodes currently has around 50 gigabytes of data related to the crisis.
- Last November, being described amongst the most avid cryptocurrency users globally by The New York Times, the Ukrainians ranked fourth as per Global Crypto Adoption Index in Chainalysis 2021. There are various factors involved. From high inflation to a general lack of trust in the local banks. As a tech-forward nation, Ukraine’s IT exports totaled about $7 billion last year. Last September, Ukraine adopted a progressive bill allowing the regulation of crypto by the government.
The use of crypto is very useful in protecting wealth and funding their escape to neighboring nations by the Ukrainians as they defend themselves from the Russian Invasion. A citizen in a somber post said that although he is safe in Kazakhstan, his Ukrainian credit card is useless as he cannot access it and with all his savings gone. His only survival option is the crypto money which he still has until he can come home safely to Ukraine.