Ukraine buys weapons and equipment with cryptocurrency

The money raised by Ukraine has been used to buy more than 400,000 rations, thousands of bulletproof vests and many night vision devices. On a live Q&A session on Twitter, Alex Bornyakov, Deputy Minister of Digital Transformation of Ukraine said that many suppliers of weapons and military equipment accept direct payments in cryptocurrencies.

Bornyakov said that the Digital Transformation Ministry is responsible for purchasing military equipment at the request of the Ministry of Defense if the weapons can be paid for with cryptocurrency. “Some military equipment vendors have crypto wallets. Also they have bank accounts in some countries that accept cryptocurrencies. So it's easy for us to buy," Bornyakov added.

Cryptocurrency is a faster and more efficient tool when compared to the international payment system SWIFT. “The situation is quite urgent and we cannot use the payment system as usual. With cryptocurrencies, the provider can receive the payment in 5-10 minutes and there is no need to wait for the bank to verify,” Bornyakov shared.

Ukraine uses the system of the cryptocurrency exchange Kuna to manage the amount of money raised. The digital wallet that the Ukrainian government uses is a multisig wallet, according to Bornyakov.

According to the published process, only when there are at least 3 out of 5 votes in favor, equivalent to 3 signatures, the Digital Converter can release funds for transactions and payments. According to Bornyakov, the Defense Ministry is the main decision-making body. However, the Ukrainian government did not disclose who the five people holding the voting power were for security reasons.

This condition is issued to ensure that the crypto fund can operate in the event of losing contact with some members. “Even though we are both in Ukraine, the tense situation can cause communication to be interrupted. This mechanism makes it possible for the government to make decisions immediately,” said Bornyakov.

President Volodymyr Zelensky is not involved in the decision-making process and calls for donations in cryptocurrency. "I don't report to him directly," Bornyakov insisted, refusing to share who was directing him.

In addition, Ukraine also refused to share a specific list of military equipment it has purchased. “We cannot disclose what we have purchased due to security issues,” Bornyakov said. However, the Ukrainian government will announce when the time is right.

As of the evening of March 10, the Ukrainian government had received “nearly $100 million” in cryptocurrency, according to CoinDesk. More than 60 million USD is stored in a digital wallet operated by the Kuna exchange. Coins accepted by Ukraine include Bitcoin (BTC), Ethereum (ETH), USDT stablecoin on blockchain network Tron, Polkadot (DOT), Monero (XMR) and Dogecoin.

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