Ukraine has collected $70 million in crypto donations since the Russia conflict began
Ukraine has received over $70 million in cryptocurrencies since the start of the Russian-Ukrainian conflict, and has provided the nation with military equipment and humanitarian aid.
The figures came from a February 24 report from blockchain data platform Chainalysis, which found that the majority of funds came in the form of 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 $11.59 million, respectively.
Donations have also come in the form of non-fungible tokens (NFTs), such as UkraineDAO’s auction of a Ukrainian flag NFT that sold for $6.1 million.
About 80% of the total $70 million donated came in the first months of the war, with the rate of cryptocurrency payments fast-tracking the country’s ability to respond to the Russian invasion, Ukrainian Deputy Digital Minister Alex Bornyakov explained in an interview with Yahoo Finance UK 24 February:
“If we used the traditional financial system, it would take days […] We were able to secure the purchase of essential goods in no time via crypto and what’s amazing is that around 60% of suppliers were able to accept crypto, I didn’t expect this.”
Bornyakov added that the Crypto Fund Aid For Ukraine was an “absolute success” and that he was impressed by not only the amount of donations that came through, but how easily the digital ministry could access these funds to launch the defense.
Alona Shevchenko, co-founder of Ukraine DAO also explained to Yahoo Finance that cryptocurrencies provided a solution when restrictions were imposed on the Ukrainian central banking system:
“The Central Bank introduced restrictions on transfers of foreign currency into and out of Ukraine to stop the run of the hryvnia […] Thanks to crypto, we were able to meet some of the defenders’ immediate needs, there was literally no other way at the time.”
According to a tweet by Mykhailo Fedorov, Ukraine’s Deputy Prime Minister and Ukraine’s Minister of Digital Transformation last August, much of the cryptocurrency payments to Ukraine’s Digital Ministry have been used to finance the country’s military equipment, armor clothing, and an assortment of vehicles and medicine.
The increased reliance on cryptocurrencies in Ukraine appears to have boosted adoption in the country, with a September-released report from Chainanalysis finding Ukrainians to be the third highest adopters behind Vietnam and the Philippines.
Related: What the Russia-Ukraine war has revealed about crypto
However, pro-Russian military groups have also used cryptocurrency to crowdfund the war effort, including using crypto donations to fund military purchases, spread disinformation and create pro-invasion propaganda, according to Chainalysis.
The 100 groups donated a combined $5.4 million during the war, but incoming donations have dropped significantly since July.
It is not clear what impact sanctions had on this downtrend, but a 10th package of sanctions against Russia was just imposed on February 24th.
Meanwhile, a recent crime report from Chainalysis found that of the total $456.8 million in ransom payments in 2022, a majority of those 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 the Russian-based pro-conflict ransomware group Conti, which collected $66 million from victims in 2022 and has previously announced its “full support” for the Russian. The authorities.
