How Ukrainians collect donations in cryptocurrency

More than $15 million worth of cryptocurrency has been donated to Ukrainian groups since Russia attacked the country on February 24, According to the research firm Elliptic. Decentralized Autonomous Organizations (DAOs) were formed to support Ukrainians. NFTs were sold to raise funds for the Ukrainian people and army. The country’s official Twitter account said it accepts Bitcoin, Ether, and Tether.

Such donations are usually made the old-fashioned way: through banks. In tech-savvy Ukraine, crypto has emerged as a quick and easy way to handle this money. It’s not just money pouring into the country, either – The stablecoin Tether is supposed to be pegged to the US dollar. But the demand in Ukraine is so high that it broke its currency peg and trading above the dollar — at $1.10, as of this writing.

“Coming from Ukraine, it is quite normal to have piles of dollars close by,” says Ilya Polosukhin, Ukrainian partner of NEAR Protocol, an Ethereum competitor. He has a family in Kharkiv, it was bombed while we were talking. “You don’t trust the local currency and on top of that, you don’t trust the banks.” This makes Ukraine a natural place for the adoption of cryptocurrency.

Ukraine Known for her technical talents, With more than 200,000 technical workers, and operated IT export business $6.8 billion in volume last year. It’s also official Legalization of Bitcoin and Other Cryptocurrencies Last Year, in a law regulating digital financial assets and providing fraud protection for Ukrainians. (Previously, cryptography was in a gray area where people could deal with it, but companies and exchanges that do have caught the attention of law enforcement.)

Country Ranked 4th in Chainalysis . Global Crypto Adoption Index, behind only Vietnam, India and Pakistan, about $8 billion of cryptocurrency passes through the country annually. “The big idea is to become one of the best jurisdictions in the world for crypto companies,” said Alexander Bornyakov, Deputy Minister at Ukraine’s Ministry of Digital Transformation. Tell New York times last year.

When Polosukhin was in Ukraine last year, he was surprised to see the widespread use of cryptocurrency, even among people not working on crypto projects. He noted that the tether is especially popular, in part because many Ukrainians used to work with the dollar as a reserve currency. There was another factor: the relative dearth of investment options. Besides the real estate market, “the only other investment opportunity is actually cryptocurrency.”

This may explain why so many crypto and Web3 supporters have rallied across the country since the February 24 invasion. Although there are concerns about it Russian companies may also use cryptocurrency to evade sanctionsAnd the The Bank of Russia has been pushing for a ban on cryptocurrency. (Instead, she prefers the digital ruble.) So when the Central Bank of Ukraine suspended digital cash transfers and limited cash withdrawals, crypto—along with dollars, gold, and silver—became a viable option for making transactions.

On a large scale, the international crypto community has reacted With messages of support for Ukraine. Vitalik Buterin, creator of Ethereum, He tweeted that the invasion was a “crime.” Against the Ukrainian and Russian peoples, adding “Glory to Ukraine”. Later, Buterin retweeted it An advertisement from Unchain.fund aimed at humanitarian relief. Nine people must sign the dispersed funds; NEAR’s Polosukhin . is located one of the signatories. After we talked, Polosukhin sent me Document with donation methods.

It’s not just Polosukhin. Member of the Russian Performing Arts Ensemble Pussy Riot Ukraine created DAO, to use the “power of web3 tech and community to raise money”. There is, too RELI3F, “A humanitarian aid initiative founded by NFT/web3 artists collaborating to support the people of Ukraine.” on twitter, CEO of cryptocurrency exchange FTX She declared that the company “just gave every Ukrainian citizen $25 on FTX. Do what you have to do.”

Yev Muchnik, a Ukrainian-born lawyer who has lived in the US since 1988, works at Ukraine United DAO with developers from Bevi. “Everyone is coming together to find ways they can help,” she told me. “It really restores your belief in how people, society and technology do so many things.” Among the DAO’s goals: to create peer-to-peer mesh networks to maintain Internet connectivity, even if centralized ISPs decline.

“The missing link is trying to figure out what people on Earth need,” Moshnik says. She believes that blockchain technology will make it easier to ensure that money raised for Ukrainians actually goes where it’s supposed to. Now the understanding of the people on the ground in Ukraine is that people are withdrawing money from their bank accounts and trying to find alternative ways of transactions.

Muchnik explains that collective coordination efforts demonstrate how cryptography can be used as a public good. It coordinates with people in Ukraine and Poland to verify and certify the organizations that have emerged. Blockchain also means that the flow of funds can be traced; Anything unused can be returned.

Oleksii Stoiko runs a popular Ukraine Telegram channel about cryptocurrency, which he created after being inspired by it. unbanked, a media organization focused on cryptocurrency. It exploded in popularity about a year and a half ago, he tells me from his home in the western part of the country. It does not surprise him that Ukrainians have turned to cryptocurrency. “Ukrainians are natural when it comes to coordination,” he says.

On February 24, Stojko was too afraid to leave his home, even though there were no Russian troops nearby. “It’s actually pretty scary,” he says. Right before we spoke, he was stiffening his apartment windows with duct tape.

When we spoke on the 25th, things in Stoiko were normal, except for the empty shelves in the big supermarkets – all the most popular foods were gone – and plenty of people were running around with their bags. But communication from the crypto community helped him feel less lonely. “My heart is really glad to read all these kind words and to support me personally and for all the Ukrainian people,” he says.

Polosukhin’s focus is now on making sure those in need are taken care of – whether it’s cryptocurrency or not. He notes that encryption is easy to send, but not necessarily easy for people to receive in the event of an internet outage or a power outage. When we talked, the only thing working in Kharkiv were the mobile service providers, and Polosukhin wasn’t sure when they would fail either. For those who did get it, cash was still the best strategy.