Nearly a year and a half have passed since Russia began to occupy Ukrainian lands as of February 2022. Ukraine showed a resistance against Russia and pushed Russia back from the vicinity of cities such as Kiev and Kharkov. The war has been locked in the eastern regions of Ukraine for a long time. Ukraine is now making plans for how to rebuild the country after the war. The government is seeking resources to determine the financial future of the country. One of these resources is cryptocurrencies. Ukraine has benefited from massive crypto donations throughout Russia’s occupation. Kiev now hopes this will help secure the country’s future.
Crypto donation to Ukraine
Since the beginning of the war, especially Western countries have provided significant financial and weapon aid to Ukraine. Among the financial aids, there is also a significant cryptocurrency donation. Since the beginning of the full-scale invasion of Russia, Ukraine has raised $225 million in cryptocurrencies alone, according to a report.Ukrainian funds raised approximately $134 million in crypto for humanitarian needs, while military-focused campaigns received $91 million in donations.
$83 million of donations came in the form of USDT. While $79 million was in ETH, Bitcoin donations contributed $41 million. The remaining donations were made up of smaller cryptocurrencies such as Binance USD (BUSD), Polkadot’s DOT and others. These cryptocurrencies were provided with vital supplies such as helmets, bulletproof vests, medical supplies, and walkie-talkies.
The ‘Ministry of Digital Transformation’ for Crypto…
Ukraine also relies on crypto to rebuild the post-war economy. There is already a ‘Ministry of Digital Transformation’ in the country. The ministry, which was established in 2019, aims to digitize all government services and increase the share of cryptocurrencies in gross domestic income. Alex Bornyakov, the country’s deputy minister for digital transformation, says that cryptocurrency is an easy-to-use and fast financial tool. Bornyakov says crypto has enormous potential to stimulate economic growth and increase employment.
Alex Bornyakov, Deputy Minister of the Ministry of Digital Transformation. Photo: LinkedInAndrei Kirilenko, a professor of finance at Cambridge Judge Business School in England, is also one of those who argue that crypto is necessary for Ukraine’s future. In Ukraine, where the gross domestic product decreased by 30 percent due to the war, 8 million people left the country as refugees. Infrastructure is in ruins. Banks and markets are often inactive. Kirilenko says that decentralized crypto can help rebuild the country when banks and markets are not enough. In addition, he stated that Ukrainians, especially refugees, could not reach the cash in their accounts. Kirilenko states that this is why the easily exchangeable crypto has become a lifeline for Ukrainians.
$225 million in crypto donations to Ukraine.Ukraine’s Ministry of Digital Transformation is also working on a number of crypto regulations. Also seeking EU membership, Ukraine is trying to balance its own crypto laws with the EU’s Crypto Assets Markets Regulation (MICA), which will come into effect in 2024. If all goes as planned, Deputy Minister Bornyakov hopes that future crypto-friendly legislation could spur a number of new crypto companies and tech startups to open stores in Ukraine. The job opportunity and tax revenue that these crypto companies will create is very important for the post-war economy of the country. Bornyakov says companies specializing in decentralized finance need and can add liquidity to their banking system.
It will provide transparency
On the other hand, the use of cryptocurrencies will provide transparency for the Ukrainian economy, which has suffered from corruption and bribery for many years. With blockchain technology, where crypto money comes from, where it goes and who it belongs to are always recorded. According to Professor Kirilenko, thanks to crypto, donations for the construction of the country will not disappear.
