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Major cryptocurrency exchanges operating in Ukraine have temporarily suspended operations with hryvnia bank cards. The measure stems from restrictions imposed by the country’s central bank, Binance and Kuna indicated in comments for crypto media.
Ukrainians Unable to Trade Crypto Assets Using Cards in National Currency
The world’s largest crypto exchange, Binance, and a leading Ukrainian exchange, Kuna, have announced temporary suspensions of operations with bank cards in Ukrainian hryvnia. Both trading platforms confirmed about the problems with such transactions.
The limited processing of deposits and withdrawals in the national currency results from restrictions imposed by the National Bank of Ukraine (NBU), representatives of Binance told the crypto news outlet Forklog. The exchange has advised traders to use its peer-to-peer marketplace.
“Currently, fiat channels, namely input and withdrawal through a bank card and other payment services, are temporarily suspended among cryptocurrency exchanges throughout Ukraine,” the trading platform stated in a Telegram post on Thursday, quoted by Bits.media.
“Regarding the hryvnia card and input/output to the exchange. Yes, it doesn’t work … In brief, we are looking for ways out of the situation, under the threat of stopping the entire Ukrainian crypto/card UAH market,” Kuna founder Michael Chobanian said in his Telegram channel.
On Friday, Chobanian suggested that the difficulties with non-cash hryvnia transactions are potentially related to efforts undertaken by Ukrainian authorities against money laundering and tax evasion through online gambling sites.
He was referring to a recent statement by a Ukrainian lawmaker who claimed that this kind of turnover amounts to 54 billion hryvnia (almost $1.5 billion) annually. The deputy, Oleksiy Zhmerenetsky, later confirmed he sees a link between the two.
Hryvnia Restrictions for Exchanges Likely to Affect Crypto Donations for War-Torn Ukraine
The issues with depositing and withdrawing hryvnia on crypto exchanges started in September, last year, and since the end of December the restrictions introduced by the central bank have become tougher, Chobanian explained. He further elaborated:
The NBU banned P2P and A2C transactions for financial companies, and since all crypto exchanges work through them, as a result, everything is gone for them.
Chobanian believes that the restrictions bring reputational damage to Ukraine, a leader in crypto adoption in the region and beyond. He thinks the situation will also affect the activities of small and medium-size companies as well as cryptocurrency donations.
Recent reports by blockchain intelligence firms Elliptic and Chainalysis revealed that, since the start of the Russian invasion in late February, 2022, Ukraine has raised over $212 million in crypto for defense and humanitarian efforts, $70 million of which has been received by government-provided addresses.
At the end of April, the National Bank of Ukraine imposed a monthly limit on transactions for the purchase of cryptocurrencies of 100,000 hryvnia per person ($3,400 at the time, around $2,700 now). The monetary authority is yet to comment on the consequences of its restrictions for the country’s crypto market.