Ukrainian servicemen are sitting on armored personnel carriers traveling on the road in the Donetsk region in eastern Ukraine, Thursday, February 24, 2022.
Vadim Girda | AP
Donations of bitcoin to the Ukrainian army are growing afterwards Moscow went on a large-scale offensive against Ukraine on Thursday morning.
New data from the analytical company Elliptic shows that for a 12-hour window on Thursday, nearly $ 400,000 in bitcoins was donated to the Ukrainian NGO “Come Back Alive”, which provides support to the armed forces.
A new round of crypto-donations is taking advantage of a trend seen in recent weeks, with donations totaling hundreds of thousands of dollars pouring into Ukrainian NGOs and volunteer groups working to prevent Russia’s offensive, Elliptic reports.
Activists have deployed the crypt for a variety of purposes, including equipping the Ukrainian army with military equipment, medicine and drones, and to fund the development of a face recognition application designed to identify a Russian mercenary or spy.
“Cryptocurrency is increasingly being used for crowdfunding war with the tacit approval of governments,” said Tom Robinson, chief scientist at Elliptic, which sells blockchain analytics tools to banks and cryptocurrency platforms.
Volunteer groups have long increased the work of the Ukrainian military, offering additional resources and manpower. For example, when pro-Russian President Viktor Yanukovych was ousted in 2014, volunteers backed protesters.
Typically, these organizations receive funds from private donors through bank transfers or payment programs. However, cryptocurrencies such as bitcoin have become more popular because they allow financial institutions to bypass payments that may block payments to Ukraine.
Volunteer groups and NGOs together raised more than $ 1 million in cryptocurrency, according to Elliptic, although that number seems to be rising rapidly as donations arrive amid Russia’s recent offensive.
A column of soldiers is approaching the Perekop checkpoint on the Ukrainian border. On the morning of February 24, President Putin announced a special military operation in response to calls for help from the leaders of the Donetsk and Luhansk People’s Republics.
Sergey Malgovka | Tass | Getty Images
Come Back Alive, which has been accepting cryptocurrency since 2018, provides the military with equipment, training services and medical supplies.
Another group, the Ukrainian Cyber Alliance, received about $ 100,000 in bitcoins, lightcoin, ether and a mix of stablecoins over the past year. Since 2016, Alliance activists have been carrying out cyber attacks against Russian facilities, says Elliptic.
On the other hand, pro-Russian separatists have been raising funds in bitcoins since the early days of the conflict.
London-based financial data analyst Boaz Sabrad told CNBC that some Russian officials had mentioned that they were not closing opposition bank accounts for fear that they would push them to raise funds for a crypt that is much harder to control.
Ukraine has also taken steps to introduce cryptocurrencies at the national level.
Ukrainian President Vladimir Zelensky and parliament have recently reached an agreement a law that legalizes and regulates cryptocurrency. The the measure goes a long way to go cryptocurrency out of the legal gray area where it is now, although it doesn’t go as far as El Salvador’s law, which adopted bitcoin as a legal payment in September.
During an official state visit to the United States in August 2021. Zelensky spoke Ukraine’s major “legal innovation market for virtual assets” as a selling point for investment, and Minister of Digital Transformation Mikhail Fedorov said the country is modernizing its payment market so that its national bank can issue digital currency.
However, the war with Russia may make all these plans meaningless.