While Democratic members of the Senate Committee on Banking, Housing, and Urban Affairs fear cryptocurrency could be used to help Russia evade economic sanctions, witnesses at a hearing on March 17 reminded lawmakers how crypto is being used for good, providing over $55 million to Ukraine for much needed humanitarian aid and supplies.
Michael Chobanian, the founder of KUNA Exchange and the president of the Blockchain Association of Ukraine, told lawmakers that following Russia’s invasion of his country, he worked with Ukraine’s Ministry of Digital Transformation and the Ministry of Defense to establish the official Crypto Fund of Ukraine to solicit cryptocurrency donations.
As of March 17, the fund has raised over $55 million, allowing Ukraine to purchase more than 5,500 bulletproof vests, 500 helmets, and 410,000 meals, among other supplies.
Chobanian worked with the Ukrainian government to ensure the fund is “fully compliant with the current laws and regulations in Ukraine.” He also noted that on March 16, Ukrainian President Volodymyr Zelenskyy fully legalized crypto in Ukraine.
Chobanian also noted that crypto solves the problem of urgency, allowing Ukraine to access the money immediately, whereas Ukrainians would typically have to wait about two days to access the money if sent through traditional banking methods. Additionally, he said crypto can “attract donations from pretty much any place in the world, even countries which don’t have access to banking.”
“Think of crypto as energy. For example, nuclear energy, you can use nuclear for good to create cheap energy or you can create bombs with the nuclear energy,” Chobanian explained. “Same with crypto, you can use it for good or you can use it for bad. It depends who uses it and how he uses it.”
The committee’s ranking member Sen. Pat Toomey, R-Pa., commended Chobanian for being “instrumental” in coordinating crypto aid for Ukraine, and acknowledged that while cryptocurrencies can sometimes pose risks, they also offer “incredible potential.”
“Crypto’s remarkable nature is that anyone across the globe can contribute to this type of effort almost instantaneously and at very low cost. It is in this context, that we should examine cryptocurrencies and their relation to illicit finance,” Sen. Toomey said.
“Throughout history, criminals have always tried to utilize new technologies for nefarious gain. That’s not a reason to stifle new technology developments,” Sen. Toomey added. “Crypto can be used to empower individuals and promote personal autonomy, but it can also support the detection and prevention of illicit crime.”
Jonathan Levin, the co-founder and chief strategy officer at Chainalysis, noted that his company’s crypto crime analysis found that only 0.15 percent of all crypto transactions involve illicit addresses.
“We need to make sure that we continue to invest in financial technology and build the financial rails that will be used by the globe in the 21st century. Embracing digital assets will help the U.S. build this future,” Levin said. “These new rails can be built in a way that encourages transparency and that not only protects our national security and public safety, but it actually enhances it.”