Ukraine Receives Crypto Donations Amid War with Russia

[TL;DR]

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As the Russia-Ukraine war rages on, essential financial services in Ukraine have been adversely disrupted. The war which Vladimir Putin, the Russian President termed a "special military operation" has led the Ukrainian government to adopt unconventional methods to ameliorate the sufferings of Ukrainians. One of such measures is a new law that allows for the launch of a legal market for virtual assets in Ukraine.

The law became expedient as crypto donations in support of the Ukrainian government and Military kept pouring in. According to reports filed by CoinDesk, close to $100 million worth of cryptocurrencies had been donated to the Ukrainian government. Donations have also been made to Come Back Alive, a Ukrainian NGO that is supporting the Ukrainian military.


On the other side, with heavy sanctions stifling business operations in Russia, its citizens are shifting to cryptocurrencies as an alternative. But major Western figures and the Ukrainian government, calls have been made to restrict the usage of cryptocurrencies in Russia. However, the request is difficult to assuage as Russia has the third-highest number of Bitcoin miners in the world. The Kremlin also valuates the local crypto market in Russia at $200 billion.

Crypto Donations to Ukraine

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As of the 11th of March, Elliptic last data states that crypto donations to Ukraine had topped $64 million, and more than $15 million of it has been used in purchasing military supplies. Alex Bornyakov, the Ukrainian Deputy Minister for Digital Transformation, also affirmed that the country has been able to pay for some army supplies with cryptocurrencies.

The Ukrainian NGO, Come Back Alive was initially at the forefront of collecting these crypto donations on behalf of the Ukrainian military. However, some days after the donation efforts gained traction, the Ukrainian government took it up by making announcements about their wallet addresses. Apart from the cryptocurrency donations, Ukraine DAO, backed by a member of the Russian activist group Pussy Riot, also launched an NFT of the Ukrainian National flag. This NFT went on to sell for $6.5 million as the 10th most expensive NFT ever. Elliptic reported in a blog post that a CryptoPunk NFT worth $200,000 was also sent to the Ukrainian ETH address.

After accepting crypto donations in Bitcoin, Ether, and USDT, the Ukrainian government started accepting PolkaDot (DOT). The government's official Twitter account was announced via a tweet. The announcement came after Gavin Wood, PolkaDot's founder tweeted that he was going to donate $5M if the government posted a DOT address.

A significant donation as reported by Elliptic was $1.86 million which was part of proceeds from the sale of NFTs created by Julian Assange and Pak. Another donation came from Sam Bankman-Fried, Founder and CEO of FTX and Alameda Research. He reportedly donated $250,000 worth of USDT. Deepak Thapliyal, the CEO of Chain.com, and Binance also donated 100 ETH and $10 million respectively to the cause.

Other donations include 1 million ICX (approximately $750,000) from Min Kim of ICON Foundation.

Ukraine's Cryptocurrency Regulations

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Before the outbreak of the Russia-Ukraine war, the Ukrainian government passed a law in February legalizing cryptocurrencies in Ukraine; however, the law did not accept cryptocurrencies as legal tender.

Before the war, Ukraine was the world's 4th largest market for cryptocurrencies. Then, considering the recent developments in the war, new legislation had to pass for the regulation of the crypto market in Ukraine.

In the new law, the National Commission on Securities and Stock Market will regulate the digital assets market in Ukraine. Based on the new law, the National Commission on Securities and Stock Market has four basic responsibilities, and they are;

• Policymaking in the area of virtual assets and securities.
• Issuance of permits to digital assets providers.
• Supervision and monitoring of the sector
• Determining the order of circulation of digital assets.

According to Mykhailo Fedorov, the Deputy Prime Minister and Minister of Digital Transformation, "The new law is an additional opportunity for business development in our country."

Even amid a Russian bombardment, the Ukrainian government is positioning the country for dominance in the cryptocurrency sector. The new legislation also provides a regulatory framework for the growth and development of blockchain startups in Ukraine.

Conclusion

As of the time of this article, the Ukrainian government was receiving crypto donations in the form of BTC, ETH, LUNA, SOL, USDT, DOT, ADA, DOGE, ICX, XMR, and CSPR. Apart from crypto donations, the government of Ukraine is also accepting fiat currency donations. Donations can be made in USD, GBP, CAD, EUR, and AUD to the Ukrainian government.

For donations to the Ukrainian government in their efforts against the Russian invasion, a website has been set up for that purpose.



Author: Gate.io Observer: M. Olatunji
Disclaimer:
* This article represents only the views of the observers and does not constitute any investment suggestions.
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