Banks paralyzed by war, cryptocurrency transactions surge in Ukraine

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As Ukraine’s central bank halted digital remittances after the Ukrainian government declared a state of emergency, cryptocurrency (virtual currency) transactions are booming, CNBC, an economic media outlet, reported on the 26th (local time).

The Central Bank of Ukraine has taken the same steps, claiming that Russians living in Ukraine can use digital money transfers to arm the Russian military. The bank’s automatic teller machines (ATMs) are no longer working.

In a situation like this, Ukrainians are starting to trade in cryptocurrencies.

According to ‘Kuna’, a popular cryptocurrency exchange in Ukraine, Ukraine is buying a lot of Tether, a so-called ‘stable coin’ whose price is fixed to the US dollar, and is also taking a premium to buy Tether.

“We don’t trust the government, and we don’t trust our banking system even more,” said one citizen. There is no alternative other than cryptocurrency,” he said.

Tether is the most popular stablecoin with a market capitalization of $80 billion (about 96 trillion), and it shows a stable price flow unlike Bitcoin and Ethereum, which are showing great volatility due to the heightened crisis in Ukraine.

Ukraine is very friendly with cryptocurrencies. Just before the war broke out, Congress passed a bill legalizing Bitcoin.

When President Volodymyr Zelensky visited the U.S. in 2021, he said he plans to “make Ukraine a cryptocurrency hub.”

Meanwhile, at 9:00 am (Korean time) on the 27th, Bitcoin was down 0.33% to $39,096 from 24 hours ago. Bitcoin remained at $39,000 on the day.

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