The Central Bank of Ukraine announced that it has imposed new restrictions on cross-border transactions in order to prevent capital outflow from the country. One of these restrictions is the national currency of the citizens. Ukrainian hryvnia was to prohibit them from purchasing cryptocurrencies using
The announcement on Thursday details that cryptocurrency purchases in foreign currency continue to be allowed, limiting total monthly purchases to UAH 100,000, equivalent to US$3,300.
JUST IN: 🇺🇦 Ukraine has banned #crypto purchases with the local currency and will only allow purchases with foreign currency with a monthly limit of $3,300.
— Watcher.Guru (@WatcherGuru) April 22, 2022
Central Bank of Ukraineconsiders crypto purchases, travel payments, foreign exchange transactions and deposits to electronic wallets as “semi-cash transactions”.
In the announcement, the details of why such a measure was necessary were also shared. The institution stating that Ukrainian citizens who had to leave the country still use their cards issued by Ukrainian banks to purchase goods and services. It was underlined that some were also found to be using “semi-cash” transactions to circumvent restrictions against investing abroad. Therefore, these transactions were interpreted as “leading to an inefficient capital withdrawal from the country”.
With these new restrictions, the institution aims to limit the possibility of such transactions. According to the Central Bank of Ukraine, the government agreed to these restrictions.
Ukraine Trying to Improve Exchange Rate
The Central Bank of Ukraine also stated that the temporary restrictions could improve the exchange rate by easing the pressure on Ukraine’s foreign currency reserves.
Since the invasion of Russia, the foreign exchange market in the country has received a significant amount of foreign currency. It was previously announced that he made a transfer of $ 1.7 billion only in March.
Part of the announcement included the note that “Related changes will help improve the country’s foreign exchange market, which it sees as a prerequisite for easing restrictions in the future.”
The new restriction will not apply to cross-border P2P transactions to support internally displaced persons from Ukraine. In this case, the bank also noted that a separate monthly limit of UAH 100,000 is provided for making cross-border transfers from bank accounts in national currency.
As the war between Russia and Ukraine approaches its third month, many in both countries face uncertainty. cryptocurrency He is known to trust his units. The country has also received over $60 million in crypto donations since the start of the war.
The country is also working on legalizing crypto, with President Zelenski signing a bill in March to create a legal framework for crypto.