Regions in eastern Ukraine are formalizing the use of cryptocurrency to bypass economic sanctions, it has emerged.
Also read: Here’s Why Bitfinex is Not Like MtGox
Eastern Ukraine Region ‘Will Be Attractive’ for Bitcoin
The Donbass region, which since 2014 has been mostly controlled by a rebel government with support from Russia, is looking to stabilize its economy and attract investment via increased use of decentralized technology.
This month saw the inauguration of DAO Donbass (Donbass Decentralized Autonomous Organization), which last week held a press conference to explain its intentions for the region.
“We’re going to make the region attractive as a place to use Bitcoin and realize blockchain projects,” a summary of the event reads on DAO’s Facebook page.
The comprehensive support from public authorities, as well as from our main target audience, the Association of Entrepreneurs, will definitely contribute to and attract participation in DAO Donbass projects from the international Bitcoin community.
Regions making up the officially unrecognized Donetsk People’s Republic (DPR) have been under an economic blockade for the past two years, with even Russian banks officially suspending cross-border transfers due to geopolitical pressure.
Gov’t ‘Convinced of Need’ for FinTech
While in Russia the situation governing the use of Bitcoin is volatile and constricted, the movement in Donbass appears to be gaining momentum and the official blessing of the local government.
“I’m convinced of the need to develop this technology in our republic,” DPR minister for education and science Larissa Polyakova said as part of the conference.
Experts advising the scheme are also involved in a working group set up across the border in Russia for the study of blockchain’s potential, Forklog reports.
Ironically, in neighbouring Ukraine, cryptocurrency has traditionally been treated more leniently, with the country boasting considerable consumer activity over the past few years, potentially in the wake of financial instability.
The aforementioned Association of Entrepreneurs meanwhile released the results of the conference, declaring wide-ranging measures for Bitcoin and blockchain development in the region going forward.
“The use of decentralized databases is not restricted to the mining and circulation of cryptocurrency,” it added.
Notionally in the spirit of decentralization, DAO Donbass invites anyone to invest in its project meanwhile, its goals set out in a flush website featuring panoramic photographs of Donetsk at sunset. Its website states:
Given the difficult situation in the region, organizers have decided to allocate 10% of funds to commercial projects which will improve socioeconomic indicators and help build a transparent model for interaction between businesses and the government.
Forklog additionally reports that international assistance for DAO Donbass is on the cards, but that the organization has hitherto not released concrete details.
What do you think about the potential for the Donbass area to combat sanctions with cryptocurrency? Let us know your thoughts in the comments section below!
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