Crypto Goes to War: Ukraine Uses Crypto for Military Aid
As much as crypto has been used for illegal activities and ruined reputation in the past, it has also been used in a good light. Crypto has helped Ukraine in many instances. It has been commonly used for donations and purchases.
Although geopolitics has posed a risk for the crypto industry, the ongoing conflict between Ukraine and Russia has unveiled how crypto can fuel military aid.
The Ukrainian government turned to asking for donations on social media in the form of crypto when the war started. This garnered a positive response, with more than 100,000 people donating to support the Ukranian military.
Besides the donations, the Ukrainian government also uses crypto to buy combat essentials such as helmets, bulletproof vests, and combat equipment. According to the Ukrainian deputy digital minister, Alex Bornyakov, about 60% of military hardware suppliers accept crypto.
Since the invasion of the war, crypto adoption has increased in Ukraine, especially in Kyiv. This has placed Ukraine at number 4 worldwide in crypto adoption.
The main advantage of crypto payments is that they eliminate intermediaries making transactions fast. This came in handy when the Ukrainian military needed help fast.
Ukraine got about $55 million from international donations in just a month. Binance also introduced a Ukraine Emergency Relief Fund, a crowdfunding site for crypto donations. This helped Ukraine get an additional $10 million.
Crypto is decentralized and transparent. This helped the Ukrainian government track the funds to see where the donations came from. Surprisingly, some came from Russia.
With success in crypto, the Ukrainian government, through the support of the Ministry of Digital Transformation of Ukraine, decided to launch Crypto Fund Aid For Ukraine initiative (CFAK). The initiative saw massive success helping Ukraine raise over $100 million. Kuna, a Ukraine crypto exchange, and Everstake, a blockchain company, power CFAK. The initiative helped Ukraine get a third of the donated amount.
With the war still on, crypto donations will continue being used for military aid. The country has some reserves in its account for the cause. Other countries facing crisis and conflict may copy the same concept.