Crypto during a crisis - Ukraine collects funds in BTC, ETH and other coins
The Ukrainian Government has announced that it will be accepting cryptocurrency donations to assist with the Russian-Ukrainian conflict. The official Twitter account of the Ukraine posted a Tweet that included bitcoin (BTC) and ethereum (ETH) wallet addresses.
The Ukrainian Vice Prime Minister, Mykhailo Fedorov, also posted a Tweet asking for support through digital currency. The wallet addresses were then verified by Ethereum co-founder Vitalik Buterin, as well as the Ukrainian Ambassador Olex Sherba.
Due to the transparency of blockchain technology, all transactions sent to the Ukrainian wallet addresses can be publicly viewed. At the time of writing, there have been 7,600 transactions into the BTC wallet address with a total of approximately 162 bitcoin being received.
Another benefit of utilising cryptocurrencies and blockchain networks is that funds can be transferred cross-border, easily accessed and instantly traded for. The benefit is such that trading volumes between the Russian ruble (RUB) and bitcoin has risen to a nine-month high as a result of the Russian financial crisis.
The RUB has plunged to record lows due to the fallout arising from Russia's invasion of the Ukraine. Strict int/rnational sanctions have caused Russia to experience a rapid financial crisis culminating, most recently, with the country being cut off from the SWIFT banking system, limiting the Kremlin's access to more than USD $600 billion in reserves.
At the same time, the ruble-denominated bitcoin volume surged to around 1.5 billion last week, the highest level since May 2021. Tether (USDT) is the worlds largest stablecoin by volume and offers price stability by pegging the value of crypto's with the US dollar on a 1:1 ratio.
As a result, tether-ruble and tether-hryvnia (the Ukraine's fiat currency) have also experienced significant increases as citizens impacted by the invasion seek stability for cratering fiat currencies.
The record uptick in RUB-bitcoin pairing could suggest that those with significant RUB holdings are seeking a more stable currency amid the RUB plunge. Whether Russian oligarchs, businessmen or even the Russian Government are converting to bitcoin to bypass international transaction sanctions is not confirmed, however, the traceability of the blockchain network would allow for a record of all those transactions with consequences to be applied in due course.