More than $46 million in crypto assets has been donated to Ukraine.
Crypto assets have become a part of the global systems and for better or worse, have inevitably become a part of the Russia-Ukraine conflict too. Historically, during a crisis, people around the world have shied away from risky assets and sought traditional havens like gold or cash (US dollar) to safeguard their capital. But the people involved in the crisis had it even worse because the financial system that had supported them became disrupted or in some cases, out of service. This means the transfer of financial assets is impeded leaving people scrambling for liquid and portable assets. In this article, we will briefly take a look at how crypto has played a key role in times of geopolitical uncertainty.
Crypto donations pour in for Ukraine
Since the Russian forces began the invasion of Ukraine, more than $46 million in crypto assets has been donated to Ukrainian government and NGOs that aid the military. According to crypto firm Elliptic, more than 70,000 donations have been made to crypto addresses posted by the official handle of Ukraine on Twitter. This includes a $5.8 million donation in DOT by Polkadot’s founder Gavin Wood and $1.86 million, which appears to have originated from the sale of NFTs originally intended to raise funds for Julian Assange.
Several million dollars in crypto donations have also been received by Come Back Alive, a Ukrainian NGO which supports the military. Also, UkraineDAO, a decentralized autonomous organization which aims to raise Ether, has auctioned off an NFT of the Ukrainian flag for $6.5 million in ETH.
The majority of donations received to date have been in Bitcoin and Ether, although US dollar pegged stablecoins contribute a significant proportion. As a thank you to all the supporters who donated crypto assets, Ukraine has confirmed a NFT drop to all of them with details yet to be determined.
Russia tries to evade sanctions
Technology is agnostic. The people who wield it determine the outcome. The same applies to blockchain technology as well. With Russia being slapped with financial sanctions from the US and few other countries, the Kremlin is reported to be navigating the sanctions through crypto.
According to crypto data provider Kaiko, transactions on centralized bitcoin exchanges in both the Russian ruble and the Ukrainian hryvnia surged to their highest levels in months. Kaiko’s report also mentioned that the ruble-denominated volume for the stablecoin Tether is more than twice as high as Bitcoin volume, which indicates stablecoins could play a more important role as a safe haven asset.
Boon or bane?
The crypto community is truly universal with more than 150 million users across the world. Bitcoin, which spearheaded the adoption of crypto, remains neutral by design even in the face of conflict. Countless people in Ukraine have utilised crypto assets to move their funds. Donations from all over the world are pouring directly into the hands of the Ukraine government and NGOs. At the same time, Russia is also reportedly trying to bypass financial sanctions through crypto.
Given the above, we can conclude that the crypto asset ecosystem needs a balanced and fair regulatory approach by governmental bodies to ensure its use cases remain just and in the hands of good actors. There are immense benefits that blockchain technology provides – they need to be captured under the right regulatory framework to make it beneficial and progressive.
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Disclaimer: This article was authored by Giottus Cryptocurrency Exchange as a part of a paid partnership with The News Minute. Crypto-asset or cryptocurrency investments are subject to market risks such as volatility and have no guaranteed returns. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.