Hi everyone. Between the first signs of spring: a climate-change-induced increase in pollen and an emerging new Covid variant. Can we get another six weeks of winter?
The clear view
Sergey Vasylchuk knew trouble loomed as Russian troops began to gather at the border. People assured him that the massed armies were just a feint, but the CEO of Everstake, a Ukraine-based blockchain company, didn’t believe it. “I’m paranoid; I’m an engineer,” he says. He begged his employees to leave the country…Call it a vacation if you want, he told them, promising to pay for a retreat in a strange sunny climate. Not everyone took up the offer. Vasylchuk himself already had plans to travel to Florida to attend flying school, a passion of his. When the invasion came – two days after he arrived in the US – he worked from his outpost in the state to make sure his parents, who are still in Ukraine, were safe, and did what he could for his employees. . Some are now fighting the Russians. “My house was probably destroyed,” he says. He’s in South Florida indefinitely — not partying with other blockchain brothers, but working “24/7,” he says, to help his country. With crypto.
“I can only do two things in my life: crypto and aviation,” he says. He chose the former and decided that the best way to serve his country was to provide it with money through digital currencies. Not long after the invasion, he set up a DAO. That is a decentralized autonomous organization, an entity whose trustworthiness can be verified by the trusted blockchain ledger. Vasylchuk worked with Ukraine’s Ministry of Digital Transformation and a currency exchange called FTX to set up a system that would allow the government to accept cryptocurrencies directly from donors. So far, the fund has raised more than $65 million, split between the country’s defense efforts and humanitarian aid. The effort is one of many using blockchain-based technologies to help Ukraine and its people during these nightmare weeks. Some have even called this conflict the Crypto War.
It is unlikely that those who have lost their homes or loved ones would agree that crypto is at the forefront here. But the chaos of war often leads to alternative economies; in this case, it’s not so much a black market (like the one that helped rebuild Japan’s economy after World War II), but one that rests on crypto’s unique virtues. Apparently, Ukrainian President Volodymyr Zelensky acknowledges this, as he signed legislation this month that blessed key activities in the crypto sector such as currency exchange and banking integration for crypto companies.
While the loot of crypto is often enjoyed by privileged investors looking to Lambos, the technology seems almost tailor-made to overcome the challenges of a besieged Ukraine. “A bitcoin transaction takes 10, 20, 30 minutes versus a transfer that can take two or three days, and you can’t be sure – by then [the Russians] would have bombed a national bank,” said Illia Polosukhin, co-founder of blockchain company Near. Polosukhin is also one of the instigators of a DAO called unleash, which has raised $7 million in aid to date. In addition, these crypto funds accept anonymous donations, which is especially beneficial to would-be donors with ties to Russia, whose leader is known to hold a grudge. Finally, the idea of using crypto in this way is simply appealing to those sitting on huge piles of bitcoin, ether or other coins with insanely high values.
But perhaps the most important aspect of wartime crypto in Ukraine is how private currencies find their way into everyday trading. Because the banking system in Ukraine is shaky, some vendors that receive coins are not interested in converting cryptocurrency to fiat. “It is not clear what the exchange rate will be between US dollars and hryvnia [the national currency], and so it is useful to have coins in crypto,” says Polosukhin. Crypto can be particularly valuable to people fleeing the country, who don’t want to travel with cash or simply can’t get it out of their bank accounts. For people staying in the country, Polusukhn says, Unchain is working on the equivalent of a crypto ATM card, where people can buy supplies using their digital wallets.
