Russians send money via crypto to help Ukraine

[ad_1]

Ukrainian President Volodymyr Zelenskiy visits troops in Kherson, Ukraine. Photo: Reuters

Russians enraged by President Vladimir Putin’s invasion are sending “significant sums” through cryptocurrency return channels to help Ukraine, according to his deputy digital minister.

Two days after Putin’s troops and tanks crossed the international border between Russia and Ukraine on February 24, 2022, Ukrainian government Twitter accounts posted requests for cryptocurrency donations.

Blockchains are publicly distributed transparent ledgers, and since then Ukraine has been analyzing where in the world crypto-donations are being sent from.

The war-torn country was able to identify that over 100,000 people sent aid to Ukraine through cryptocurrency channels.

“Donations to Ukraine have ranged from one dollar to millions of dollars,” Ukraine’s Deputy Digital Minister Alex Bornyakov told Yahoo Finance’s The Crypto Mile.

“Crypto, in some cases, offers an anonymous way to transfer money. We saw some Russians donating a large sum to us,” Bornyakov added.

“The Russians who donated sent large sums.

“I understand that from Russia, there is no other way for them to do this than through crypto.”

The majority of crypto donations received by Ukraine to date have been in bitcoin (BTC-USD) and ether (ETH-USD), although US dollar stablecoins have contributed a significant share.

A third of the donation amount comes from the Crypto Fund Aid For Ukraine initiative, which is powered by Ukraine-based crypto platform Kuna and blockchain company Everstake, and backed by Ukraine’s Ministry of Digital Transformation.

Some of the most popular digital asset donations sent to Ukraine include bitcoin, ethereum, cardano (ADA-USD), solana (SOL-USD), polkadot (DOT-USD) and stablecoins such as l USDC (USDC-USD) and USDT (USDT-USD).

“So far, Ukraine has received about 650 bitcoins, more than 10,000 ethereum, and there was also a significant amount of polkadot, almost 1.8 million in solana and 2.8 million in the form of the USDC stablecoin,” added the Deputy Minister of Digital.

The story continues

Ukraine’s crypto and blockchain industry

Since the start of the Russian invasion, Ukrainian cryptocurrency exchange Kuna has become the country’s largest crypto fundraising platform, an exchange founded by Ukrainian Mykhailo Chobanian in December 2015.

To cash in crypto sent from all over the world, the Ukrainian government uses Kuna.

According to Crystal Blockchain Analytics, as of November 30, over $184 million in crypto assets had been raised to support Ukraine.

These include a one-time transaction of $1.86 million from the sale of NFTs created by Julian Assange and Pak.

And, a CryptoPunk NFT worth around $200,000 was also sent to the Ethereum account of the Ukrainian government.

Ukrainian NGO ‘Come Back Alive’, which supports the national army, has received several million dollars in crypto donations, as reported by research from blockchain analytics firm Elliptic.

However, crowdfunding and content creation platform Patreon suspended Come Back Alive’s page on February 24 for violating policy related to its military activities.

A crypto donation can be made through the website for people who wish to send cryptocurrency as a help to the country and its citizens. However, since the collapse of FTX in November 2022, the website link now redirects to the official Ukrainian government donation website.

Ukraine’s war-torn economy

Since the recent Russian missile strikes against Ukraine’s energy infrastructure, national electricity rationing has been in place. The window in which Bornyakov could conduct the interview with Yahoo Finance UK was limited.

The Russian invasion had a significant impact on the Ukrainian economy. The country faced declining industrial production, rising inflation and a depreciating currency.

The loss of Crimea and its industries when Russia annexed the region in February 2014 also disrupted trade and investment, causing Ukraine’s gross domestic product to fall and unemployment to rise.

In addition, the country has also had to deal with increased military spending and aid for internally displaced people, further compounding the economic impact.

The International Monetary Fund (IMF) estimates that the conflict has cost Ukraine at least a third of its GDP in 2022. Ukraine’s own economic data shows a 30.4% drop in GDP since the start of the crisis. war.

“In 2022, the Ukrainian economy suffered the greatest loss and damage in the entire history of independence, inflicted by the Russian Federation,” said Ukrainian Economy Minister Yulia Svyrydenk, who is also First Deputy Prime Minister, in a statement in January.

The drop in GDP has also been described as the largest on record since Ukraine gained independence from the Soviet Union in 1991.

Ukraine DAO and Russian political activist Nadya Tolokonnikova

In July 2022, prominent political activist and Pussy Riot member Nadya Tolokonnikova told The Crypto Mile that NFTs can make powerful statements of civil disobedience and protest.

Tolokonnikova co-founded Ukraine DAO (Decentralized Autonomous Organization), which raised $6.75 million ($5.66 million) in Ethereum in five days for organizations helping Ukrainians suffering from the war that devastated their country. The funds were raised by selling an NFT depicting the Ukrainian flag.

Speaking on episode 4 of The Crypto Mile, she said NFTs can be used to advance political causes: blocked by the Russian banking system.

Although the blockchain is a publicly visible distributed ledger that records all transactions transparently, the system is beyond the reach of centralized authority and the crypto wallets that send and receive funds can remain anonymous.

Read more: UK unveils ‘world’s first’ plans to regulate crypto and digital assets

“When you fundraise for activism, it’s often for very sensitive topics that can potentially lead to trouble, so crypto can provide a layer of anonymity,” Tolokonnikova said.

The co-founder of arts activist group Pussy Riot also launched Unicorn DAO in May 2022.

Unicorn DAO is committed to using the NFT space to “redistribute wealth and visibility to create equality for identified women and LGBTQ+ people”.

The movement cites a 2021 report from ArtTactic, which found that only 5% of NFT sales were made by artists who identified as women.

Alex Bornyakov, Deputy Minister of Digital Transformation for Ukraine. Photo: David “Dee” Delgado/Reuters

The integration of NFTs, DAOs and Decentralized Finance (DeFi) is transforming the way charities collect donations and distribute funds to those in need.

Crypto advocates told news outlet Cointelegraph that the new technology has led to the creation of “new mechanisms for distributing wealth.”

According to crypto-author Anne Connelly, every organization will eventually have a crypto donation platform, just like they accept credit cards.

Download the Yahoo Finance app, available for Apple and Android.

Watch: Bitcoin on Breakout Ahead of Fed Rate Meeting – The Weekly Crypto Mile Update

[ad_2]