The new Fiat restrictions in Ukraine to increase the popularity of cryptocurrencies, Industry BlockBlog says

The Central Bank of Ukraine adjusted the fixed exchange rate of the national currency to the US dollar and introduced stricter limits on hryvnia transactions for citizens. The measures should encourage more Ukrainians to turn to cryptocurrencies, according to a representative from the local cryptocurrency industry.

The limits of the hryvnia in wartime should increase interest in the cryptocurrency

The National Bank of Ukraine (NBU) has introduced new rules in response to fundamental changes in the country’s economy during an ongoing military conflict with Russia. On Thursday, the monetary authority devalued the Ukrainian hryvnia by 25% against the strong US dollar and set new limits on banking operations with the national fiat.

According to the updated legislation for individuals, which came into force on 21 July, banks can sell currencies other than cash to their customers only if the amounts are deposited for a period of at least three months, without the possibility of terminating the contract.

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The 50,000 hryvnia limit for credit card withdrawals has now been replaced with a weekly limit of 12,500 ($ 340). Peer-to-peer transfers abroad from cards issued by Ukrainian banks were reduced from 100,000 hryvnia (about $ 2,700) to 30,000 hryvnia ($ 800). And the limit for cross-border settlements with hryvnia cards was set at 100,000 per month.

All the measures introduced since the beginning of the war are temporary and allow the economy to survive, assured the governor of the NBU Kirill Shevchenko. However, they are hitting Ukrainians badly, especially the millions of Ukrainian citizens who have been forced to leave the country and still cannot return.

The latest NBU restrictions could lead to increased Ukrainian interest in cryptocurrencies, Ukrainian cryptocurrency exchange Kuna founder Mikhail Chobanyan commented for cryptocurrency news Forklog. “We expect an increase in the revenue and use of cryptocurrencies. In Europe, 100,000 hryvnia is nothing,” added the entrepreneur.

Chobanyan also noted that the new limits will hinder the work of volunteers, as most humanitarian aid is purchased with cards issued by Ukrainian banks and held by individuals. “We will now completely switch these flows to cryptocurrencies,” said Chobanyan who called the central bank’s policy aggressive and warned that Ukrainian banks and the state budget would be the losers.

Keywords in this story

Central bank, Crypto, Cryptocurrency exchange, Cryptocurrencies, Cryptocurrency, Currency, deposits, Fiat, foreign currency, hryvnia, individuals, Kuna, limits, national currency, nbu, operations, restrictions, transactions, Ukraine, Ukrainians, Withdrawals

Do you agree that many Ukrainians will turn to cryptocurrencies amid growing restrictions on fiat transactions? Tell us in the comments section below.

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Lubomir Tassev

Lubomir Tassev is a tech-savvy Eastern European journalist who loves Hitchens’ quote: “Being a writer is who I am rather than what I do.” In addition to cryptocurrencies, blockchain and fintech, international politics and economics are two other sources of inspiration.

Image credits: Shutterstock, Pixabay, Wiki Commons

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