Ukraine has received more than $70 million in cryptocurrency since the start of the Russo-Ukrainian conflict, providing the nation with funds for military equipment and humanitarian assistance.
The figures come from a February 24 report by blockchain data platform Chainalysis, which found that most of the funds came from Ether (ETH) and Bitcoin (BTC).
ETH donors led the way with $28.9 million given, while BTC and Tether (USDT) donors chipped in $22.8 million and $11.6 million, respectively.
Donations have also come in the form of non-fungible tokens, such as UkraineDAO’s auction of a Ukrainian-flagged NFT that sold for $6.1 million.
About 80% of the total $70 million donated came in the first months of the war, and the speed of cryptocurrency payments accelerated the country’s ability to respond to the Russian invasion, Ukraine’s deputy digital minister Alex Bornyakov said. . explained In an interview with Yahoo Finance on February 24:
“If we used the traditional financial system it would take us days […] We were able to secure the purchase of vital items in the blink of an eye through crypto, and the amazing thing is that around 60% of vendors were able to accept crypto, I didn’t expect this.”
Bornyakov added that Crypto Fund Aid For Ukraine was an “absolute success” and that he was impressed not only by the number of donations that came in, but also by the ease with which the digital ministry could access those funds for the defense of Ukraine.
Alona Shevchenko, co-founder of Ukraine DAO, also explained to Yahoo Finance that cryptocurrencies provided a solution when restrictions were placed on Ukraine’s central banking system:
“The central bank introduced limits on foreign currency transfers in and out of Ukraine to stop the run on the hryvnia […] Thanks to cryptocurrencies we were able to meet some of the immediate needs of our advocates, there was literally no other way at the time.”
According to an August tweet from Mykhailo Fedorov, Ukraine’s deputy prime minister and minister of digital transformation, much of the cryptocurrency payments to the digital ministry have been used to finance the country’s military equipment, armor clothing, and a variety of vehicles and medicines. .
With $54M raised by @_AidForUkraine, we have supplied our defenders with military equipment, armor, medicine and even vehicles. Thank you to the crypto community for your support since the beginning of the full-scale invasion! Donation by donation to the big win. Report below. pic.twitter.com/lifHAP8R4f
— Mykhailo Fedorov (@FedorovMykhailo) August 17, 2022
The increased reliance on cryptocurrencies in Ukraine appears to have increased adoption in the country, with a September report by Chainanalysis which found that Ukrainians are the third most adopters, behind Vietnam and the Philippines.
Related: What the Russia-Ukraine war has revealed about cryptocurrencies
However, pro-Russian military groups have also used cryptocurrency to crowdfund their war efforts, including using crypto donations to finance military purchases, spread disinformation, and create pro-invasion propaganda, according to Chainalysis.
The 100 groups have received a total of $5.4 million over the course of the war, however donations received have declined considerably since July.
It is not clear what impact the sanctions had on this downward trend, but a tenth package of sanctions against Russia showed up on February 24.
Meanwhile, a recent crime report by Chainalysis found that of the total ransomware payments of $456.8 million in 2022, the majority of these funds were taken by “actors” believed to be based in Russia.
Chainalysis explained that such attacks are often used by bad actors for political agendas, such as Russia-based pro-conflict ransomware group Conti, which claimed $66 million victims in 2022 and has previously announced its “full support” for Russian . government.
