The two sides in the bitter conflict in Ukraine have been relying on crypto assets and technology to support their military and humanitarian activities, Elliptic says in a report. According to the blockchain forensics company, the target nation has attracted more digital asset donations than the invading power.
Ukraine Supporters Sent Over $212 Million in Cryptocurrency
Both Russia and Ukraine have employed blockchain technology to secure funding for their war efforts since Russian forces attacked on February 24, 2022, Elliptic revealed in a news release. report exploring the evolving role of cryptocurrencies in the conflict. The study is based on data compiled by the cryptanalysis firm over the past year.
On the anniversary of the invasion, the company said that “many campaigns have sought to leverage core developments in the crypto ecosystem to help their fundraising, from decentralized finance (defi) to crypto prepaid cards.” Digital cash was used for various purposes, from humanitarian causes to funding sanctioned groups.
Analysis of transactions tracked by Elliptic shows that most of the money, $212.1 million in crypto assets, went to support Ukraine. Anti-government organizations in Belarus, a close political and military ally of the Russian Federation, raised $0.7 million.
Pro-Russian groups have raised around $4.8 million for the Russian army and associated militias. More than 10% of these donations came from illicit sources, according to the report. These include darknet marketplaces, sanctioned entities, and providers of stolen credit cards, the authors detailed.
At the same time, less than 2% of the cryptocurrency donated to Ukraine came from such sources, Forklog commented in its coverage. The crypto news outlet also noted that since May 2022, pro-Russia activists have increased their funding and in June raised more bitcoin and ether than Ukrainians.
Between the end of February and the end of September, pro-Russian entities collected around $400,000 worth of cryptocurrency, according to a study by digital asset compliance and risk management firm TRM Labs. In July, blockchain intelligence firm Chainalysis revealed that 54 of these groups have collectively received more than $2.2 million in cryptocurrency.
Ukraine’s Digital Minister Claims Most Military Providers Accepted Crypto
Many of the crypto-funding initiatives on the Ukrainian side have been supported or initiated by the Kiev government, which received $83.3 million in its own wallets. Defi, non-fungible tokens (NFTs), and decentralized autonomous organizations (DAOs) have played a significant role in facilitating crypto fundraising for Ukraine, attracting more than $78 million in donations, Elliptic noted, adding that Russian attempts to emulate Ukraine’s success in this area have failed.
Speaking to Yahoo Finance UK’s The Crypto Mile podcast, Ukraine’s Minister of Digital Transformation Alex Bornyakov revealed that his country has been purchasing military equipment using crypto and claimed that 60% of vendors agreed to be paid in coins. to provide Ukraine with essential items such as helmets and bulletproof vests.
More than 100,000 people have sent cryptocurrency to Ukraine, according to the report, with Bornyakov saying donations ranged “from one dollar to millions of dollars.” He noted that Ukraine turned to cryptocurrency at the start of the war because it needed immediate help. “If we used the traditional financial system, it would take us days,” he explained.
Do you think both sides of the war will continue to rely on crypto donations to finance their military and humanitarian efforts? Share your thoughts on the subject in the comments section below.
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