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December 9, 2024
The devastating war in Ukraine is historic in many ways, and one of them is the great importance of the use of Crypto technologies. In Ukraine, Russia, and the whole world, the current conflict made Crypto more relevant than ever. The use of digital coins to transfer money, raise donations, and bypass existing financial systems has grown enormously since the beginning of the war.
Here are just some of the ways the Russian-Ukrainian changing how people use Crypto and NFT:
After Russia invaded Ukraine, the west imposed strict economic sanctions to cut off Russia off from the global economy. The US has forbidden American businesses to transact with Russian persons and companies. The Rubble’s value dropped drastically, and the money held by the Russian people lost its worth. The sanctions caused many to speculate that digital assets and particularly Bitcoin, will be used as a way to bypass the sanctions.
At this point, Cryptocurrency’s problematic image as something seedy that can be exploited for money laundering was being put to the test. Leaders of the Crypto community were quick to respond and explain that all blockchain transactions are tracked and stated they would abide by official sanctions. Brian Anderson, CEO of Coinbase, the leading platform for Crypto trade in the US, announced that his company would respect the law like any other American business. “ We screen people who sign up for our services against global watchlists and block transactions from IP addresses that might belong to sanctioned individuals or entities, just like any other regulated financial services business,” he claimed on his Twitter account.
1/ We've been seeing some questions/discussion around whether crypto can be used to avoid sanctions. A few thoughts…
— Brian Armstrong – barmstrong.eth (@brian_armstrong) March 4, 2022
Ukraine has been rated 4th in the world in terms of Crypto adoption rate. It has actively encouraged Crypto companies to transfer their activity to the country in the last years. In February, just six days before the Russian troops crossed the border, the Ukrainian parliament passed groundbreaking laws to regulate the use of Crypto in the country. And in the middle of March, Zelenski signed another law that makes Cryptocurrencies and other Digital assets legal.
For millions of Ukrainians fleeing their homes, Crypto is a convenient way to take money with them, especially while the country’s economy is in peril. Money transfers and withdrawing foreign currencies have been forbidden since the invasion, and the amount of crypto transactions has skyrocketed. In this way, crypto has proved to be the ideal asset in wartime conditions. All you need to take with you are your passwords.
The importance of Crypto technologies in Ukraine has also been evident from the flow of Crypto donations to fund resistance and help those affected. A few weeks ago, the Ukrainian government launched an official website that encourages people across the globe to donate cryptocurrency. “Help Ukraine with Crypto, Don’t leave us alone with the enemy,” announces the website that claims to have gathered more than $70 Million from the crypto community so far. Zelensky’s move to legalize crypto may be part of the effort to use these funds. Cryptocurrency companies, many of which operate from Ukraine, have also joined in by providing incentives for their Ukrainian users.
In addition to all this, selling NFTs has become a surprisingly effective means of raising funds for the Ukrainian people. While the Ukrainian government has sold official war bonds, independent artists’ cooperatives have been raising donations by selling images of the Ukrainian flag as NFTs. After the Russian activist and long-time crypto proponent Nadezhda Toloknikova has supported the project, one of the flags sold for over $6.7 million. Another initiative by the NFT community is the first-ever NFT “museum” called “Meta History: War Museum”. The project raised over half a million dollars on its first day by selling digital images. Creators from across the globe have been selling NFTs for charity in what is seemingly the most extensive crypto crowdfunding in history.
Official NFT Collection of the Ukrainian Government,
— META HISTORY: Museum of War (@Meta_History_UA) March 31, 2022
Is live!
To celebrate $500,000+ raised, we will be giving away one of our unique NFTs.
To enter
1. Follow @Meta_History_UA
2. Like and retweet this post
Mint Now: https://t.co/ig8rEIPZxh#NeverForgetThis pic.twitter.com/7ImhvMk5OD
While we don’t know how the war in Ukraine will unravel, we can already say that it has strengthened the position of crypto as a durable financial means in times of crisis. At the same time, NFTs have become an effective tool for fundraising. Even those who doubted the future of these technologies can not overlook the role they play in the current crisis. Will crypto turn out to be Zelenski’s secret weapon, and how will it affect the economy of both countries? Too soon to say, but it is already clear that governments can no longer ignore the need for regulations and a redefinition of assets for the digital age.
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