Privatbank, Ukraine’s largest commercial bank by assets has halted money transactions to cryptocurrency exchanges.
Last Friday, Privatbank said that it would temporarily prohibit its customers from acquiring Bitcoin with the Ukrainian hryvnia, the country’s main fiat currency (UAH). Since March 15, the temporary prohibition has extended.
Restrictions in Compliance to Orders
PrivatBank has placed under restrictions as a result of an order from Ukraine’s National Bank. The Central Bank of Ukraine issued prohibitions and restrictions under martial law on February 24. Martial law is a term that refers to the temporary military rule of civil functions and law.
In reaction to the Russian invasion, Ukrainian President Volodymyr Zelensky addressed the people on February 24 and declared martial law for 30 days. On March 15, President Zelensky announced a 30-day extension of martial law in Ukraine, which had been in effect since March 26.
Ukrainian banks anticipate to limit cash withdrawals from customers’ accounts as a result of the Central Bank’s regulation. They are only allowed to spend UAH 100,000 each day, or about $3,400 per day. The rate of the hryvnia is similarly set.
Furthermore, banks barre from conducting cross-border currency transfers from Ukraine on behalf of consumers. It’s no different when it comes to transferring funds for use on cryptocurrency exchanges. Customers cannot transfer funds in the national fiat currency to cryptocurrency exchanges, according to the institutions.
As a result, PrivatBank has taken a number of precautions to maintain financial stability while martial law is in effect. They raised withdrawal limits and offered credit holiday periods.
Some of the country’s top banks are apparently prohibiting its customers from purchasing Bitcoin in local currency. While major banks have prohibited their customers from purchasing cryptocurrencies, certain large Ukrainian crypto exchanges still accept UAH for Bitcoin purchases.
Crypto’s Essential Contribution
President Volodymyr Zelenskyy signed a new bill into law on Thursday, making cryptocurrency legal in Ukraine. The move allows domestic and international crypto exchanges to operate lawfully, as well as allowing local banks to open cryptocurrency accounts.
Since the beginning of Russia’s war with Ukraine, Ukraine has received hundreds of millions of dollars in cryptocurrency donations.
Mykhailo Fedorov, Ukraine’s minister of digital transformation issued a statement after the president signed the law. According to him, the President’s signature on this bill is yet another critical step toward pulling the crypto sector out of the shadows. It also establishes a legal market in Ukraine for virtual assets.
Cryptocurrency users who want to contribute their digital riches to the country can now do so. This will do through the Ukrainian government’s official donation scheme. The goal for the government is to raise $200 million in cryptocurrency donations. As of this writing, the government has obtained slightly over $55 million worth.
