Ukraine’s Law Enforcement and Counterintelligence Agency has managed to confiscate funds in a cryptocurrency wallet used to fund the Russian military campaign in the country. Officials in Kyiv claim that the money collected through the wallet was spent on military equipment for pro-Russian separatist forces in the east.
Ukraine seizes cryptocurrency donations to fund Russia’s invasion
The Security Service of Ukraine (SBU) for the first time implemented a mechanism to limit the collection of funds through cryptocurrency for forces fighting on the Russian side in the ongoing hostilities in the country. The conflict escalated into full-scale war when the Russian military crossed the Ukrainian border in late February in what Moscow calls a “special military operation” in support of the pro-Russian breakaway regions of Luhansk and Donetsk.
In a press release on Tuesday, the SBU announced that a crypto wallet run by a citizen of the Russian Federation and used to sponsor Russian military efforts in Ukraine has been blocked. The man, who presented himself as a volunteer, had been raising funds for the needs of Russian troops since the beginning of the invasion.
The SBU said the wallet had amassed 800,000 hryvnias of cryptocurrency (nearly $22,000 at current rates) by the time it was blocked, adding that the funds have since been seized. Experts are now working to trace the relevant transactions and transfer of custody to Ukraine. The agency did not specify how it seized the wallet but did reveal that it had received help from foreign crypto firms.
Ukrainian investigators were able to establish that the owner of the wallet allocated a significant part of the donated cryptocurrency to the purchase of military supplies for separatist fighters in the self-proclaimed People’s Republics of Luhansk and Donetsk. Representatives of the Ukrainian National Police and the Prosecutor’s Office also participated in the operation.
Russian “volunteer” active on social media
The Russian activist has been actively seeking financial assistance via social media platforms since the start of the last phase of the conflict. To further his efforts, he regularly creates and publishes photo and video content, distributes posts posted by colleagues and reports on the use of funds raised.
A report by forensic firm Chainalysis last month revealed that 54 pro-Russian groups have collectively received more than $2.2 million in cryptocurrency. These organizations, which operate from Donetsk and Luhansk, received most of the donated amounts in bitcoin (BTC) and ether (ETH), but also other cryptocurrencies.
Ukraine itself has been dependent on crypto donations, with both the government in Kyiv and volunteer groups raising digital money to fund defense efforts. Ukrainian Minister of Digital Transformation Mykhailo Fedorov recently announced on Twitter that $54 million in crypto funds raised through the Ukraine Aid Initiative has been spent to purchase body armor, medicines, night sights, and even vehicles for the Ukrainian military.
The Ukrainian people have also received purely humanitarian aid from the cryptocurrency community and industry. European cryptocurrency exchange Whitebit, which has Ukrainian roots, has offered to support Ukrainian refugees through its representative offices abroad and the world’s largest cryptocurrency exchange, Binance, has issued a special crypto card to Ukrainians forced to leave their homes.
You can support Ukrainian families, children, refugees and displaced persons by donating BTC, ETH and BNB to Binance Charity Ukraine Emergency Relief Fund.