Wealthy Ukrainians who haven’t fled the country are using crypto as a safe haven as the Russia-Ukraine crisis escalates. However, the limited quantity of Tether’s USDT dollar-linked stablecoins has driven the exchange rate up significantly.
Michael Chobanian, who founded Kuna in Ukraine, thinks, you can read his thoughts here. He talked about how hard it is to buy crypto, how uncertain the local economy is, and how blockchain could be used in the current geopolitical turmoil.
It was on February 18 that President Biden said he was sure Russia would invade Ukraine in the next few days or weeks, focusing on the capital city of Kyiv. This is what he said. For the next 30 days, the Ukrainian government has declared a state of emergency. They did this because they were afraid that Russia would try to invade them.
Ukrainians are afraid of money and want to get rid of cash, Chobanian said in an interview. This is what people in Ukraine want to do.
In order to hedge with cryptocurrencies, traders typically buy USDT, then sell it for other coins like bitcoin or ether. The issue is that there isn’t enough USDT in your location for purchasers to pay a 4% premium.
The situation gets worse because Ukraine’s local currency has been devalued. The hryvnia has lost 6% of its value since February 16, which shows how unstable things are now.
Chobanian said about Ukraine that there is nothing they can do with the money they have right now. They don’t believe the government, banking, and money in their area.
In the worst case, he said, the internet and the whole banking system could go down in Ukraine, and crypto could be a safe place.
Abundance of Crypto Legal Tender
He said that most people do not have anything else to choose from. There are a lot of people who want to get into the crypto world, but it is not easy.
A lot of money is going into crypto. But they cannot find people who are willing to do the opposite, sell it, so they cannot do that.
It is a bad time for the crypto sector right now, says Chobanian. He is worried that there won’t be enough money to invest in his country and that the economy will be bad soon. Then, there is also a chance for new systems to come into Ukraine, such as blockchain firms.
That’s what he said: Kuna’s biggest problem is that it works only in Ukrainian money, and no one wants to use the Ukrainian banking system right now because we are on the verge of war. We are a little stuck.
Around 400,000 people use Kuna, and 90% of them are from Ukraine.
On the way to work in his car, Chobanian told me that the streets are much quieter than they used to be a few days ago. He thinks that a lot of rich people, business people, and people who work with crypto have left Ukraine. Many people he knows have sent their families out of the country and are staying in Ukraine to protect their country. He told us to do that right now.
“The views and opinions on this Crypto News Website are solely those of the authors and contributors. These views and opinions do not necessarily represent those of iBaseTrading or its partners.”