Ukraine bans Bitcoin purchases with local currency amid martial law

The National Bank of Ukraine (NBU) continues taking measures to forestall superior outflows amid martial instrumentality by enforcing large restrictions connected cryptocurrency purchases.

The Ukrainian cardinal slope officially announced Thursday a acceptable of restrictions connected cross-border operations, prohibiting individuals from buying cryptocurrencies similar Bitcoin (BTC) with the nationalist fiat currency, the hryvnia (UAH).

Ukrainians are present allowed to bargain Bitcoin and different cryptocurrencies lone with overseas currency, with full monthly purchases constricted to 100,000 UAH ($3,300). The applicable bounds besides applies to planetary peer-to-peer transactions.

According to the announcement, the NBU has deemed crypto purchases arsenic “quasi currency transactions” alongside operations similar physics wallet deposits, overseas speech transactions and question payments. By adopting restrictions connected specified transactions, the cardinal slope aims to forestall the “unproductive outflow of capital” from the state amid martial law.

“The applicable changes volition assistance amended the overseas speech market, which is simply a indispensable prerequisite for easing restrictions successful the future, arsenic good arsenic reducing unit connected Ukraine's planetary reserves,” the NBU wrote.

The cardinal slope admitted that the request for planetary transactions has massively accrued amid martial law, with millions of citizens being forced to permission Ukraine. However, the NBU cannot spend “unproductive superior outflows,” which see investing successful cryptocurrencies, the announcement notes, adding:

“Quasi currency transactions [...] are chiefly carried retired to circumvent the existent restrictions of the National Bank, successful peculiar for investing abroad, which is prohibited nether martial law. Therefore, the applicable transactions should beryllium interpreted arsenic starring to unproductive superior outflows.”

According to the NBU, the Ukrainian authorities adopted the applicable changes arsenic portion of the NBU committee solution from April 20, 2022, which entered into unit connected Wednesday.

Related: Ukraine’s largest savings slope halts Bitcoin buys with hryvnia — Report

Some Ukrainian banks person adopted specified restrictions already, according to respective sources. PrivatBank, the largest commercialized slope successful Ukraine, reportedly prohibited its customers from purchasing BTC with UAH successful mid-March.

The restrictions seemingly rise eyebrows arsenic the Ukrainian authorities has been actively moving to legalize cryptocurrencies amid martial law. In March, Ukrainian president Volodymyr Zelenskyy signed a law to found a ineligible model for the state to run a regulated crypto market.