Wednesday 30 November 2022
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Pro-Russian groups raised only 4% of crypto donations sent to Ukraine

According to data from crypto analytics firm Chainalysis, users have sent more than $2 million in crypto to 54 pro-Russian groups since Feb. 24, a fraction of that received by many wallets controlled by the Ukrainian government.

In a Friday blog post, Chainalysis said it had tracked funds sent to social media accounts controlled by pro-Russian groups in Bitcoin (BTC), Ether (ETH), Litecoin (LTC), USDT-TRX, and Dogecoin (DOGE) starting with the country’s invasion of Ukraine in February. According to Chainalysis’ data, users sent roughly $2.2 million to the pro-Russian groups, with more than $1 million going to a single unnamed account.

While there may be other groups outside of Chainalysis’ investigation of those supporting pro-Russian forces, the available data suggested that the $2.2 million in donations amounted to roughly 4% of crypto sent in support of Ukraine. Wallet addresses connected to Aid for Ukraine, a platform backed by the government’s Ministry of Digital Transformation, showed the organization had received more than $45 million in crypto since launching in March. Crypto exchange Binance, which facilitates donations through its Ukraine Emergency Relief Fund, reported more than $10 million received since February.

Both Russia and Ukraine have taken heavy losses and casualties since the invasion began. Aid for Ukraine reported that crypto sent to its wallets would be used to support the country’s military as well as humanitarian projects; meanwhile, Chainalysis reported the $2.2 million sent to pro-Russian groups could be used primarily for military equipment and to finance propaganda sites.

“While significant, the $2.2M worth of crypto donated to pro-Russian orgs still pales in comparison to the tens of millions in crypto donated to Ukraine,” said Chainalysis.

The donations to Ukraine have seemingly been in accordance with international laws. However, Chainalysis reported that roughly half of the crypto sent to the pro-Russian groups would be used to support military forces in the Donetsk and Luhansk territories of Ukraine’s Donbas region — areas specifically sanctioned by the Office of Foreign Assets Control, or OFAC, at United States Department of the Treasury.

In addition, Chainalysis reported that Russian national Alexander Zhuchkovsky, also listed as a Specially Designated National on OFAC’s sanctions, has used social media channels to promote the Terricon Project. The group reportedly supported Russian efforts in the war against Ukraine through crypto donations for the military in the Donbas region and the fraudulent sale of nonfungible token artwork.

Related: NFT sales will fund the restoration of physical monuments in Ukraine

Following the invasion of Ukraine and the subsequent economic restrictions imposed on Russia by the United States, many global lawmakers targeted crypto as a way for Russian individuals and businesses to potentially evade sanctions. Amid these measures, Russian President Vladimir Putin signed a bill into law prohibiting digital financial assets as payments in July.

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