According to a report by Elliptic, all parties in the ongoing conflict in Ukraine have been using cryptocurrency assets and technology to fund their military and humanitarian endeavors. The blockchain forensics firm claims that the targeted country has received more donations of digital assets than the invading force.
Massive Support for Ukraine: $212 Million Raised in Crypto Donations
Elliptic highlighted in a report analyzing the significance of cryptocurrencies in the conflict that both Russia and Ukraine have used blockchain technology to raise funding for their war activities since the Russian military attacked on February 24, 2022. Based on data gathered over the previous year by the crypto analytics company, the report.
On the anniversary of the invasion, it was stated by the company that it has been observed that numerous fundraising campaigns have attempted to leverage fundamental advancements in the cryptocurrency ecosystem, such as decentralized finance (DeFi) and prepaid crypto cards. These developments have been sought after to assist in their fundraising initiatives.
According to Elliptic’s analysis of the transactions it tracked, $212.1 million worth of cryptocurrency assets—the majority of the funds—were used to support Ukraine. Belarus, a strong political and military ally of the Russian Federation, drew $0.7 million for antigovernment organizations.
Pro-Russian organizations have amassed over $4.8 million for the Russian military and affiliated militias. According to the report, over 10% of these donations came from illegitimate sources. Authors highlight that they include darknet markets, sanctioned businesses, and stolen credit card sellers.
In its article, Forklog noted that less than 2% of the cryptocurrency contributed to Ukraine emanated from these types of sources. Since May 2022, activists supporting Russia have boosted their donations, and in June, they raised more bitcoin and ether than their Ukrainian counterparts.
TRM Labs, a digital asset compliance and risk management firm, conducted a study revealing that pro-Russian organizations amassed around $400,000 in cryptocurrency between the end of February and September. Chainalysis, a blockchain intelligence firm, disclosed in July that 54 organizations had collected almost $2.2 million in cryptocurrencies.
Majority of Ukraine’s Military Suppliers Embrace Digital Currency
Many crypto-funding efforts on the Ukrainian side were backed or initiated by the Kyiv government, which collected $83.3 million in its own wallets. Elliptic noted that Defi, non-fungible tokens (NFTs), and decentralized autonomous organizations (DAOs) played a significant role in facilitating crypto fundraising for Ukraine, which attracted over $78 million in donations, and that Russian attempts to replicate Ukraine’s success in this area have failed.
During the discussion on Yahoo Finance UK’s The Crypto Mile podcast, Ukraine’s Minister of Digital Transformation Alex Bornyakov divulged that his country has been utilizing cryptocurrencies to procure military equipment. He also disclosed that 60% of the suppliers agreed to receive payment in digital currencies to supply Ukraine with helmets and bulletproof vests.
According to the report, more than 100,000 people have sent cryptocurrency to Ukraine, and Bornyakov stated that donations ranged from one dollar to millions of dollars. He pointed out that Ukraine resorted to cryptocurrency at the beginning of the war due to the need for immediate assistance. As explained, if they had used the traditional financial system, it would have taken several days.