Cryptocurrency is “fulfilling the function it was initially created for,” in Ukraine, according to The Scotcoin Project CEO and cryptocurrency expert Temple Melville.

Research from blockchain tracking company Elliptic found cryptocurrency equivalent to more than $54.7 million (£41.5m) had been donated to the Ukrainian Government and non-governmental organisations (NGOs) in the country as of March 3rd.

Ukraine launched its call for cryptocurrency donations on 26th February, just two days after the Russian invasion, requesting Bitcoin, Ethereum, Polkadot, and Tether be sent to specific wallet addresses. More cryptocurrencies are now being accepted.

Originally, the Ukrainian Government also had plans for an ‘airdrop’ – a future giveaway of crypto tokens in return for donations. However, it has since changed strategy, announcing that non-fungible tokens (NFTs) to support Ukrainian Armed Forces would be revealed soon.

The Scotcoin Project Community Interest Company (CIC) has donated the equivalent of £10,000 to Ukraine through BBX UK, a network where organisations can use cryptocurrency to buy other companies’ spare goods and services.

Uninterruptable, peer-to-peer features of cryptocurrency made it the ideal way for people to donate to Ukraine directly, when other crowdfunding sources have come up against problems, Temple commented.

There has also been a surge in the volumes of cryptocurrency trades using Ukraines’ fiat currency, the hryvnia, with people hoping to minimise the risk of a banking system collapse in the country by exchanging savings for crypto tokens.

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Commenting on the impact cryptocurrency is having, Melville said: “We are all deeply moved by what we have seen happening in Ukraine. It is a human tragedy on a scale that is difficult to process. For many people, including ourselves, the most practical way to provide support is through donations and cryptocurrency is one of the best ways of ensuring it gets to the intended recipient securely and quickly.

“This is exactly the type of situation cryptocurrency was set up to help and the vast amount of it that has been sent to the Ukrainian Government and organisations on the ground demonstrates the power it has to support those in need.”

He added: “The transparency involved is another important factor – anyone can view transactions on the blockchain and check that donations have been delivered to the address you want.

“While there have been calls to block Russian users, the way the networks are set up mean their transactions could also be easily traced too.

“The Ukrainian Government has indicated it will start to take more cryptocurrencies soon, opening up more opportunities to directly donate to a country that desperately needs our help.”

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