Ukraine’s Central Bank has announced a ban on any Bitcoin purchases from residents as part of the country’s martial law. The governing bank says it only allows Bitcoin purchases with foreign currency up to 3,400 USD a month.
The National Bank of Ukraine (NBU) reportedly upholds these measures as part of the country’s actions to mitigate exporting the fiat money under martial law. The control measures of the governing bank include major clampdowns on purchases of virtual assets like Bitcoin, Ethereum, and non-fungible tokens.
The announcement of Ukraine’s central bank reportedly came on Thursday, including prohibitions on crypto-related international trades, restricting residents from purchasing digital assets using the national legal tender, the hryvnia.
The NBU only permits Ukraine’s residents to purchase virtual currencies with foreign currency, no more than 100,000 UAH, equivalent to about 3,400 USD per month. Additionally, cross-border P2P deals fall within the NBU’s upper cap on the maximum value of virtual assets’ purchases.
According to the announcement, the Ukrainian national bank categorizes deals in buying virtual assets as “quasi” cash deals. The categorization reportedly includes other financial transactions like FOREX deals, e-wallet savings, and traveling settlements.
The supervising bank says the restrictions are intended to avoid unproductive capital transfers outside the nation under the operational martial law. Moreover, the NBU says the regulations would help beef the country’s FOREX market towards relaxing strains on the country’s external asset reserves.
The National Bank of Ukraine (NBU) asserted a higher need for cross-border payments and deals under martial law in the entire financial sector. Millions of Ukraine’s residents have to flee the country amidst the war.
However, the supervising financial institution says the country couldn’t allow “unproductive” asset transfers, a category that includes crypto investments. From the governing bank’s statement, Martial law stipulates that residents do not invest outside the country.
Further reports say that Ukraine’s national government took up the necessary actions concerning a regulation of the central bank’s governing board which became operative on Wednesday.
Reports say that some banks within the Eastern European country have started adopting the most recent regulations of the governing bank. For instance, the foremost commercial bank in the country, PrivatBank, reportedly prevented account owners from buying Bitcoin with the hryvnia.
However, the latest prohibitions of the Ukrainian federal government come as a surprise as the country has reportedly been moving to legalize virtual assets under Ukraine’s martial law. Last month, Ukraine’s leader Volodymyr Zelenskyy reportedly approved a legal provision that allowed the nation to legally host a virtual asset industry under specific regulations and terms.
US Freezes Assets of Russian Cryptocurrency Mining Company
Meanwhile, the United States Treasury Office has added Bitriver, a Russian mining farm for virtual assets, to sanction Russian institutions. This event marked the first time the United States sanctioned Russia’s cryptocurrency market. The US says the firm is responsible for protecting Russia from international financial sanctions amidst its invasion of Ukraine. Industry observers wait to see how US restrictions on Russia’s crypto industry will affect it.