Ukraine legalizes cryptocurrency to finance resistance to Russian invasion, making it easier to appeal for donations.
President Volodymyr Zelensky has just ratified the law approved by the Ukrainian Parliament on February 17, 2022.
In this way, the legalization of 13 cryptocurrencies wants to facilitate and accelerate the donations of support to the country in the face of the Russian invasion.
Law whose objective is "to bring the cryptography sector out of the shadows", like El Salvador, the first historical country to recognize Bitcoin as an official currency.
If in principle cryptocurrencies free traditional banking intermediaries (and everything that accompanies them), this time the operation is carried out in synergy with the country's banks.
All that was missing was the signature of President Volodymyr Zelensky to finalize this legalization, announced on Twitter this Wednesday, March 16, 2022, by the Ukrainian Ministry of Digital Transformation.
Alex Bornyakov, Deputy Minister of Digital Transformation in Ukraine, comments: "Cryptocurrencies are proving to be a great help in facilitating the sending of funds to the Armed Forces in Ukraine."
Donations that can now go through the official website "Aid for Ukraine" (AID FOR UKRAINE), recently set up.
Financing the Ukrainian Resistance
Now, cryptocurrencies have become an essential tool for financing the Ukrainian resistance.
Donations of cryptocurrencies from all over the world had already started before the Russian invasion.
Donors seem much more visionary than many Western politicians...
Some of these donations would even exceed 10 bitcoins, i.e. the equivalent of 380,000 euros (price on March 18, 2022).
On the strength of these demonstrations of financial support for the resistance already committed even before the launch of "special military operations" by Russia, the Ukrainian government has launched its first calls for donations in cryptocurrencies.
A historic step has been taken again, bringing the era of dematerialized currencies into that of "crypto-resistance".
"Do not leave us alone with the enemy"
Here is the credo published on the site's home page for this official fundraiser, launched by a country at war: again, a historic first!
Immediately after the officialization of cryptocurrencies in Ukraine, the Ukrainian Ministry of Digital Transformation rolled out an official website (in English).
Objective: to structure fundraising for the country's armed forces.
A very optimized site: the donation is possible from the home page, by clicking on the name of the desired cryptocurrency.
This efficiency, coupled with an impressive reactivity, demonstrates that the Ukrainian government had largely anticipated its approach.
Long before the Russian attack...
Call for donation relayed by Twitter
The site relays Twitter posts under the hashtag #HelpUkraineWithCrypto (in English, "Help Ukraine with cryptocurrencies").
The objective displayed by the progress bar on the home page is to reach 200 million dollars.
In less than a week, more than 60 million dollars equivalent was collected.
And the donations keep pouring in, at a steady pace of millions of dollars a day (always in equivalent).
13 cryptocurrencies are accepted:
- Bitcoin (BTC)
- Cardano (ADA)
- Casper (CSPR)
- Dogecoin (DOGE)
- Ethereum (ETH)
- Hedera (HBAR)
- ICON (ICX)
- Monero (XMR)
- Polkadot (DOT)
- Solana (SOL)
- Terra (LUNA)
- Tether (USDT ERC-20)
- Tether (USDT TRC-20)
Donations by transfer in fiduciary currencies remain possible, in five currencies: euro (EU), dollar (USD), pound sterling (GBP), Canadian dollar (CAD) and Australian dollar (AUD).
For each, the site indicates the bank information of the account on which to transfer the funds.
Bitcoin Buddy-Buddy with banks?
This legalization by Ukraine of 13 dematerialized currencies is done in synergy with the traditional banking system.
From the country... A detail that is important.
Indeed, the trend of historical financial organizations is rather distrust of cryptocurrencies.
At least the ones they don't control
In France, our banks have been trying to dematerialize our hard and stumbling pennies for more than 20 years, thanks in particular to the "virtual wallet".
However, in Ukraine, the banks, and particularly the Ukrainian National Bank, are fully involved in collection.
Thus, after being registered in cryptocurrencies, the donations are transferred to a platform.
The cryptocurrencies are then converted into dollars there and then sent to the Ukrainian government via SWIFT.
The famous interbank network from which some Russian banks have been excluded.
Expenses through crypto donations
Donations used very concretely: On March 11, 2022, Alex Bornyakov, Deputy Minister of Digital Transformation in Ukraine, announced that he had been able to buy:
- 5 550 bulletproof vests
- 3 125 heat vision goggles
- 410 000 food rations
Without however specifying the amount of the expenses.
What we forget...
We forget that what works for a call to crypto-resistance, could well be used by a country against which significant economic sanctions have been launched.
Thus, the exclusion of the swift system will not weigh very heavily, if Russia in turn formalizes cryptocurrencies.
Or created his own crypto-currency...
Let us remember again that cryptocurrencies are - for the moment - totally free from the globalized financial and banking system.
This historic turning point could well motivate some states to regain control of cryptocurrencies.
Or while waiting to be able to do so, ban them purely and simply, like China...