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The Law Enforcement and Counterintelligence Agency of Ukraine has managed to seize the funds in a cryptocurrency wallet used to finance the Russian military campaign in the country. Officials in Kyiv claim that money collected through the wallet has been spent on military equipment for the pro-Russian separatist forces in the east.
The Security Service of Ukraine (SBU) has for the first time implemented a mechanism to curb fundraising through cryptocurrency for the troops fighting on the Russian side in the ongoing hostilities in the country. The conflict escalated into full-scale war when the Russian army crossed the Ukrainian border in late February in what Moscow calls a “special military operation” in support of the pro-Russian breakaway regions of Luhansk and Donetsk.
In a press release on Tuesday, the SBU announced that a crypto wallet operated by a citizen of the Russian Federation and used to sponsor Russia’s military efforts in Ukraine has been blocked. The man, who introduced himself as a volunteer, has been collecting money for the needs of the Russian forces since the start of the invasion.
The wallet had accumulated digital coins worth 800,000 hryvnias (nearly $22,000 at current exchange rates) when it was blocked, the SBU said, adding that the funds have since been seized. Experts are now working to trace the related transactions and transfer custody to Ukraine. The agency did not specify how it seized the wallet, but revealed that it was assisted by foreign crypto companies.
Ukrainian investigators have been able to determine that the wallet’s owner devoted a significant portion of the donated crypto to the purchase of military supplies for the separatist fighters in the self-proclaimed Luhansk and Donetsk People’s Republics. Representatives of the National Police of Ukraine and the Prosecutor’s Office also participated in the operation.
The Russian activist has been actively seeking financial assistance on social media platforms since the latest phase of the conflict began. To promote his efforts, he has created and regularly posted photo and video content, distributed posts published by associates and reported on the use of the funds raised, the SBU detailed without revealing the Russian’s identity.
A report by blockchain investigative firm Chainalysis revealed last month that 54 pro-Russian groups have collectively received over $2.2 million in cryptocurrency. These organizations, operating from Donetsk and Luhansk, received most of the donated amounts in bitcoin (BTC) and ether (ETH), but also other cryptocurrencies.
Ukraine itself has relied on crypto donations, with both the government in Kyiv and volunteer groups raising digital money to fund defense efforts. Ukraine’s Minister of Digital Transformation Mykhailo Fedorov recently announced on Twitter that $54 million in crypto funds raised through the Aid For Ukraine initiative have been used to purchase body armor, medicine, night sights, and even vehicles for the Ukrainian army.
The Ukrainian people have also received purely humanitarian aid from the crypto community and industry. European crypto exchange Whitebit, which has Ukrainian roots, offered to support Ukrainian refugees through its representative offices abroad and the world’s largest coin trading platform, Binance, issued a special crypto card for Ukrainians who had to leave their homes.
You can support Ukrainian families, children, refugees and displaced persons by donating BTC, ETH and BNB to Binance Charity’s Ukraine Emergency Relief Fund.
Do you expect Ukraine to block more crypto wallets used to finance the Russian military offensive? Tell us in the comments section below.
Image credit: Shutterstock, Pixabay, Wiki Commons, Yalcin Sonat
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