Ukraine: Turning to cryptocurrencies in an effort to keep funds safe
- Worried about rising tensions, locals have been buying up stablecoins, the dollar-backed electronic currencies often criticised by Western regulators
- ‘Cash is useless, you cannot do much with it, it can be easily taken away with a gun. USDT (stablecoin) is a safe haven,’ boss of cryptocurrency exchange said
Russia’s build-up led many Ukrainians to turn to cryptocurrencies, before the invasion seized up the sector. But it is still facilitating global fundraising efforts, albeit through an opaque decentralised system that Russia could also exploit to circumvent sanctions.
Having evacuated part of his team from Kyiv, Mike Chobanian, boss of cryptocurrency exchange Kuna, is watching the effects of Russia’s invasion on his flourishing industry with a weary eye.
“Business is running, but we’re in survival mode over here,” the 37-year-old boss said during a video call from his current refuge after leaving Ukraine capital.
The Ukrainian government on Friday imposed sanctions against the rouble, forcing Chobanian to halt cryptocurrency swaps with the Russian currency. “But who cares when it’s war?” he said.
His platform saw a steady rise in business from Ukrainian accounts in recent weeks. Worried about rising tensions, locals were buying up stablecoins, the dollar-backed electronic currencies often criticised by Western regulators for their opacity.
“Bitcoin, you engage yourself in gambling, you don’t know if it’s going to go up or down,” explained Chobanian. “But here you’re trying to preserve what you have and people perceive the US dollar as a safe heaven. Cash is useless, you cannot do much with it, it can be easily taken away with a gun. USDT (stablecoin) is a safe haven.”
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Ukraine conflict: Gunshots fired to disperse huge crowds at Kyiv train station
Though trading has become increasingly difficult since the invasion, several cryptocurrency users have launched fundraisers that they say are dedicated to aiding the Ukrainian and relief efforts.