Ukraine Blocks Cryptocurrency Wallet Used to Raise Funds for Russian Forces

Law enforcement agencies and counterintelligence of Ukraine successfully seized funds from a cryptocurrency wallet that was used to finance the Russian military campaign. Kyiv officials say the money raised through the wallet was spent on military equipment for pro-Russian separatist forces in the country’s east.

Ukraine has confiscated cryptocurrency donations to fund the Russian invasion.

The Security Service of Ukraine (SBU) has for the first time created a mechanism to stop fundraising through cryptocurrencies for military personnel fighting on the side of Russia in the ongoing hostilities in the country. The conflict escalated into a full-scale war when the Russian army crossed the Ukrainian border in late February in what Moscow calls a “special military operation” in support of the separatist pro-Russian Luhansk and Donetsk regions.

In a press release on Tuesday, the SBU said a cryptocurrency wallet operated by a citizen of the Russian Federation and used to fund Russian military operations in Ukraine has been blocked. The man, who introduced himself as a volunteer, has been collecting money for the needs of Russian troops since the beginning of the invasion.

The wallet had accumulated 800,000 hryvnia worth of digital coins (nearly $22,000 at current exchange rates) at the time of the blocking, the SBU said, adding that the funds have since been seized. Currently, experts are working on tracking the relevant transactions and transferring funds for safekeeping in Ukraine. The agency did not elaborate on how it seized the wallet, but said it was assisted by foreign cryptocurrency firms.

Ukrainian investigators were able to establish that the owner of the wallet spent a significant part of the donated cryptocurrency to buy military equipment for separatist fighters in the self-proclaimed Lugansk and Donetsk People’s Republics. Representatives of the National Police of Ukraine and the Prosecutor General’s Office also took part in the operation.

Russian “volunteer”, active in social networks

The Russian activist has been actively seeking financial help on social media since the beginning of the last phase of the conflict. To popularize his efforts, he regularly created and published photo and video content, distributed posts published by associates and reported on the use of the funds raised, detailed the SBU without revealing the identity of the Russian.

A report last month by blockchain forensics firm Chainalysis showed that 54 pro-Russian groups collectively received more than $2.2 million in crypto. These organizations, based in Donetsk and Luhansk, received most of the donations in bitcoin and ether, as well as in other cryptocurrencies.

Ukraine itself relied on cryptocurrency donations, while the Kyiv government and volunteer groups collected the digital currency to fund defense efforts. Ukraine’s Digital Transformation Minister Mykhailo Fedorov recently tweeted that $54 million worth of cryptocurrencies raised through the Aid to Ukraine initiative were spent on bulletproof vests, medicines, night sights, and even vehicles for the Ukrainian army.

The people of Ukraine also received purely humanitarian assistance from the crypto community and the industry. The European crypto exchange Whitebit, which has Ukrainian roots, offered support to Ukrainian refugees through its foreign offices, and the world’s largest currency exchange Binance issued a special crypto card for Ukrainians forced to leave their homes.

You can support Ukrainian families, children, refugees, and displaced people by donating BTC, ETH, and BNB to the Binance Charity Ukraine Emergency Relief Fund.

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