The world’s first crypto war in the Russia-Ukraine conflict

by nativetechdoctor
3 minutes read

The conflict between Russia and Ukraine is leading to the world, according to the Washington Post .

An IT expert in Kiev (the capital of Ukraine) founded an NGO called Come Back Alive (CBA) to call for donations to the country’s army and receive equivalent cryptocurrency donations. $400,000. On the other hand, observers believe that Russia will use cryptocurrencies in many transactions to avoid financial sanctions from the US and Europe.

The two examples above show that both of these economies are approaching crypto in their own way to gain an edge in the current geopolitical struggle. Along with the ongoing battle on the geographical and cyber fronts, the first major conflict of the crypto era saw a tool that could move billions of dollars easily across borders, and inside. Anyone can take advantage.

“Because of its decentralized nature, cryptocurrencies can be used to raise funds to build the Ukrainian army, but also to help Russia,” said Tom Robinson, co-founder of crypto analytics firm Elliptic. avoid sanctions. No one can stand in the way no matter how crypto is used.”

But the influence of this type of technology is still a question for financial experts and observers. Donating a few hundred thousand dollars in Bitcoin is indeed landmark, but compared to the $650 million worth of weapons aid the US gave to Ukraine last year, it is just “salt in the pool”.

Meanwhile, according to blockchain data research firm Chainalysis, hackers from Russia are accused of gaining around $400 million worth of cryptocurrency from ransomware attacks last year, representing 74% of revenue. global crime. However, this amount is too small when compared to the value of foreign exchange transactions that Russian financial institutions handle every day in 2021 (reaching $ 46 billion, according to the US Treasury Department).

Both Ukraine and Russia are high crypto adoption countries. Chainalysis ranks Ukraine as Europe’s top crypto-acceptor and fourth globally. Last September, the Kiev authorities legalized cryptocurrencies.

Russia, on the other hand, is seen as a hub for illegal crypto activities, including ransomware attacks and money laundering, according to Chainalysis. The company’s report revealed that business in Moscow (Russia’s capital) has pocketed the equivalent of $700 million in digital assets from criminal sources over the past three years. This also presents a possible avenue for those seeking to circumvent sanctions.

According to Decrypt, gold could have been a method of exchange in a war zone 20 years ago. Now, cryptocurrencies are playing this role. In the ongoing confrontation, cryptocurrency is pulled in and turned into a tool for the parties involved. This also raises concerns about the risk when the cryptocurrency user community uses this form to interfere in political and military issues that they are not sure they understand themselves. They can sponsor any party involved, as long as the trust gives them a good reason.

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