In only 24 hours, Kyiv sold over 1,200 non-fungible tokens, or NFTs, using technology built by the trio, generating almost $600,000 to assist fund its defense against Russia.
According to analytics firm Chainalysis, President Volodymyr Zelensky’s administration has also urged would-be contributors throughout the world to directly send bitcoins, raising more than $56 million. The NFT sale drew collectors from Los Angeles to Barcelona, who regarded it as a watershed event for both Ukraine and the crypto world.
“The Ukraine war is devastating, and it will be in history books,” said Ben Jacobs, co-founder of Scenius Capital, a digital asset investment business. “This usage of crypto technology is also historical in its own right.”
Jacobs, who lives in Venice Beach, California, spent a total of $1,100 on two NFTs, including modest transaction costs. The Ukrainian government received around $1,000 in ether, the cryptocurrency often used for NFT purchases.
Alternative financing methods that do not entail borrowing are also tempting, given Ukraine’s aversion to significantly raising its debt load.
“We don’t want to end up, as the war comes to the reconstruction phase, to spend more on the debt service than we pay on rebuilding infrastructure,” Butsa said.
This is where cryptocurrency donations and NFT sales may help. Ukraine has been encouraging people to transfer bitcoin and other cryptocurrencies via official social media accounts for weeks.
The endeavor has provided the government with access to a big pool of modest donors who do not have to worry about complicated financial arrangements or currency translation.
According to Chainalysis, as of March 28, Kyiv has raised almost $56 million in cryptocurrency, with a typical gift of about $30.
Last month, Ukraine’s deputy minister of digital transformation, Alex Bornyakov, stated that the funds were used to purchase protective jackets, helmets, walkie-talkies, and medication.
UkraineDAO, earned more than $6.7 million through the sale of an NFT of Ukraine’s flag. With the formal NFT auction this week, the endeavor entered a new phase.
Supporters from all over the world purchased digital artwork created by local artists that mixed vibrant visuals with combat relics such as tweets.
Kevin Lista Navarro, a 26-year-old financial adviser in Barcelona, previously donated to help Ukrainian migrants. Nonetheless, he regarded the NFT auction as a once-in-a-lifetime chance and purchased two.
“Thanks to this technology, you now have the possibility to contribute to the cause and also receive in return a commemorative work of art,” he said. “Who knows what they might be worth in the future.”
“How Ukraine has really leaned into crypto as a way to garner support financially … it shows the value of governments leaning into crypto and NFT technology, as opposed to rebelling against it simply because it’s new and scary,” said Jacobs of Scenius Capital.
The auction, which makes unique use of blockchain technology as a wartime finance tool, exemplifies how Ukraine’s government is embracing both new and old techniques to produce the cash it requires to survive the crisis.