Ukraine’s Bitcoin Exchange Volume Doubles as Russia-Ukraine Conflict Escalates

Kuna, a long-running native crypto exchange, has seen a dramatic shift in client activity in the wake of currency controls and the hryvnia at all-time lows. According to data, in the wake of Russia’s invasion of Ukraine, Bitcoin (BTC) and other altcoin trading volumes have surged at a major Ukraine cryptocurrency exchange. On February 24, the volume at Kuna nearly tripled to over $4 million, according to the monitoring resource CoinGecko.

Ukrainians Taking Notice of Cryptocurrency

Fiat currencies in both the United States and Russia were immediately affected as hostilities with Russia erupted. In addition to the Russian ruble, the Ukrainian hryvnia fell to a new all-time low of 30 to the dollar. After months of back-and-forth, lawmakers in Ukraine have finally ratified a law legalizing cryptocurrencies, which has sparked an uptick in interest. In Kuna, a seven-year-old whose volume was below $1 million on February 21 but was near $4 million three days later, the effect was apparent.

According to CoinGecko data, the initial rush has already begun to subside, coinciding with stabilising fiat rates versus the US dollar and other major currencies. Weirder still was Kuna’s rates, which showed an odd spread on either side of the Bitcoin spot price. Bitstamp’s BTC/USD price was $38,300 at this writing, while Kuna’s USD price was well over $40,000. In contrast, the stable coin Tether (USDT) traded at $37,800 per bitcoin.

The Central Bank is Restricting Currency Freedom

In the meantime, this week’s news about currency regulations in the government provided an additional rationale for entering the Bitcoin space.  Cash withdrawals are now limited to 100,000 UAH ($3,353) each day, and cross-border foreign currency purchases and withdrawals are prohibited entirely, according to the National Bank of Ukraine, which implemented the restrictions on Wednesday.

According to a Facebook post, the Bank was also attempting to maintain a steady exchange rate for the hryvnia. Russia’s Central Bank, meanwhile, began interfering in foreign exchange markets on Thursday to support the country’s plummeting ruble, with multiple operations appearing to have taken place over the past 24 hours.