This story has was originally published February 8 and has been updated to include events following Russia’s February 24 invasion of Ukraine.
Cryptocurrencies may never deliver on its promise currency quotidian to buy a cup of coffee. But it has proven to be a powerful, regulatory-resistant means of sending large amounts of money anywhere in the world — including Ukraine’s war zone.
Cryptocurrency payments to the military and hacktivist groups in Ukraine aimed at combating Russian aggression against the country surged in the second half of 2021, according to crypto tracing and blockchain analytics firm Elliptic. Crowdfunding payments to those institutions in bitcoin, litecoin, ether, and other cryptocurrencies the company tracks totaled around $550,000 last year, compared with just $6,000 last year. 2020 and lower in previous years, even at the height of Russia’s 2014 inroads into the country.
And now, in the days immediately following Russia’s all-out military assault on Ukraine, those numbers have spiked, with more than $4 million sent to a single Ukrainian military aid organization just to name a few. in two days.
That $4.6 million may be just a fraction of the total amount that Ukrainian hacking and defense groups have raised by more traditional means. But the sudden rise of crypto in these global donations shows how borderless, often unregulated, crypto payments can fund organizations involved in conflicts. future, said Tom Robinson, founder of Elliptic. “Cryptocurrencies are censorship resistant, so there’s no chance of them having their funds seized or their accounts closed, as can happen with PayPal, and it’s also easier to donate across,” says Robinson. border. “It has proven itself to be an effective way to finance wars.”
A Ukrainian group called Come Back Alive, for example, raised $200,000 for the Ukrainian military in the second half of 2021 alone, according to Elliptic, but doubled that amount on February 24, Russia Day. aggression. The next day, it received $3.4 million in crypto donations, including $3 million sent by an individual. Initially, the group lobbied for donations for military equipment such as bulletproof vests, but it has since expanded to fund the purchase of reconnaissance and targeting systems.
A more controversial group called the Myrotvorets — Ukrainian for “Peace Makers” —Center has publicly named and shamed alleged Russian supporters or pro-separatists. Russia in Ukraine — at least two of them were later assassinated. Myrotvorets raised $268,000 in crypto before the Russian invasion, Elliptic said, of which $237,000 came only in the second half of last year.
Pro-Ukrainian attackers are also increasingly funding their digital resistance through cryptocurrency. Elliptic has traced a $100,000 crypto donation to a hacker group known as the Ukrainian Cyber Coalition, which has been responsible for a variety of hacking and website leaks and vandalism targeting people. Russia and Russian government agencies. Cyber Partisans, a Belarusian hacktivist group that has gained global attention thanks to launched a politically motivated ransomware attack on the railway system of Belarus, has also raised around $84,000 in crypto. (Elliptic included that number in its total of $550,000 in 2021, even though the group claimed to be Belarusian, not Ukrainian, due to hackers supporting Ukraine and demanding Belarusian Railways stop transporting Russian troops to prepare for any invasion of Ukraine.)
