For those well-read on the economic and financial pressures induced by conflict, it will come as no surprise that Ukraine ranks highly in CryptoCasino’s recent survey of cryptocurrency adoption globally.

Researchers analysed each country against four key metrics: percentage of the population holding cryptocurrency, the cost and profit of mining one bitcoin, and search volume per 100,000 population for crypto-related keywords. In this ‘crypto-friendly’ ranking, war-torn Ukraine came in at fourth place, with over 10% of its population holding cryptocurrency, and mining costs particularly cheap – averaging around $19,530 per bitcoin. In the first spot was Argentina, with the US following in second and Columbia third. 

While cryptocurrencies have been rising in popularity in recent years – with crypto ownership bloating from 432 million to 580 million in 2023 alone – some nations have had no choice but to support the growth of these industries. Ukraine is a prime example, with Russia’s invasion directly catalysing its legalisation of cryptocurrency.

Why is crypto a good defence?

In the wake of the February 2022 incursion, there was a run on Ukrainian banks and the hryvnia’s value dipped dramatically. In response, Kyiv turned to digital currencies, such as Bitcoin, Ethereum, and Tether, for financial aid.

Just two days later, the Ukrainian government launched a crypto fundraising campaign, which soon broadened in scope to accept over 70 different crypto assets. By March, crypto accounts were fully legalised in the country, enabling over $200mn in crypto to reach pro-Ukraine causes, says The Financial Times. These funds helped to purchase bulletproof vests, helmets and walkie talkies.

For a country on a war footing, there are many benefits to adopting crypto. Thanks to its decentralised nature, there is no third-party bank involved, which means digital currencies can be traded at speed. This becomes a useful tool for pushing funds in and out of warzones. Indeed, currencies such as bitcoin can serve as intermediate currencies that streamline remittance across borders, to reach displaced relatives, for instance.

Decentralisation also makes the currencies nigh-on immune to manipulation from governments, bad-acting or otherwise.

The dark side of crypto use

One nation which did not make it on CryptoCasino’s top-ten list is Russia. While its adoption has not been as rapid as its shell-pitted neighbour, it has turned to crypto for militia group fundraising, ransomware attacks, and to circumvent international sanctions. Private crypto fundraising for pro-Ukrainian causes outpaced Russian equivalents by a rate of 44 to 1 in 2023.

There is a drive to address these issues. The European Union, for its part, is looking to push through a Markets in Crypto-Assets (MiCA) law, which will instil financial tracking systems and legal compliance for crypto. What is more, the International Monetary Fund published a guide on the handling of crypto assets for member countries. It seeks to provide an initial policy framework for governments.

CryptoCasino’s research shows that momentum for crypto continues to build across Europe, Asia and the Americas. In the case of Ukraine, speed of adoption can be directly traced to its war with Russia. But with greater adoption comes greater pressure on all to address looming uncertainties around regulation, security, and volatility – especially in a highly globalised world.