The fixed rate of the national currency in U.S. dollars has been modified by the central bank of Ukraine, and stricter restrictions on hryvnia transactions for citizens have been put in place. According to a representative of the local cryptocurrency industry, the measures are probably going to encourage more Ukrainians to use cryptocurrencies.
New regulations have been made by the National Bank of Ukraine (NBU) in response to the country’s economy’s shifting fundamentals as a result of an ongoing military conflict with Russia. On Thursday, the monetary authority set new restrictions on banking activities using the national fiat currency and devalued the Ukrainian hryvnia by 25% against the strong dollar.
Banks can only sell non-cash foreign currency to their customers in accordance with the updated regulations for private individuals, which went into effect on July 21, if the amounts are deposited for a duration of at least three months with no provision for contract termination.
The previous weekly withdrawal cap of 12,500 hryvnia ($340) has been replaced with the previous cap of 50,000 hryvnia. Peer-to-peer transfers abroad from cards issued by Ukrainian banks have been cut from 100,000 hryvnia (approx. $2,700) to 30,000 hryvnia ($800). And the limit for cross-border settlements with hryvnia cards has been set at 100,000 per month.
All the measures introduced since the beginning of the war are temporary and allow the economy to survive, assured NBU Governor Kirill Shevchenko. However, they are seriously affecting Ukrainians, especially those millions of the nation’s citizens who have been forced to leave the country and are still unable to return.
According to Mikhail Chobanyan, the founder of the Ukrainian cryptocurrency exchange Kuna, the most recent NBU restrictions may spark a surge in interest in cryptocurrencies among Ukrainians. “We anticipate a rise in cryptocurrency use and turnover. 100,000 hryvnias is nothing in Europe, the businessman continued.
Chobanyan also pointed out that the new restrictions will make it harder for volunteers to carry out their duties because most of the aid is obtained using cards from Ukrainian banks that are owned by private individuals. Chobanyan, who characterized the central bank’s policy as aggressive and warned that Ukrainian banks and the state budget will suffer, said, “Now we will completely switch these flows to cryptocurrency.”