The Ukrainian government has verified that everyone who donates their cryptocurrency contributions before 11 a.m. ET on Thursday, March 3, would be eligible for an airdrop. The possibility of a reward for the global community of donors heralds the emergence of new potential use cases for cryptocurrency among a broader range of mainstream audiences.
To provide some perspective, airdrops are free tokens, or NFTs given out by companies or crypto projects to their communities to promote adoption – in this example, to raise contributions to the government. The administration has not offered any more information regarding what will take place with Thursday’s airdrop.
According to Luke Martin, presenter of The Coinist Podcast, “Ukraine will make history tomorrow by being the first nation-state to airdrop a token to individuals who contribute.”
Russia invaded Ukraine on February 26th, prompting Ukraine to begin its unorthodox crowdfunding campaign two days later, on February 26. The cryptocurrency exchange has amassed more than $30 million since then, according to Elliptic statistics, which shows that it has received about 50,000 contributions to its Ethereum, Polkadot, and US dollar Tether wallets as of Wednesday morning. Users may also switch listed tokens into ether contributions for Ukraine using the major decentralized exchange Uniswap, which has added a new “Donate to Ukraine” function to its platform. Users can swap listed tokens into ether donations for Ukraine in a single Ethereum transaction. A representative from the exchange was not immediately available for comment.
“The Ukrainian people are thankful to Uniswap,” Mykhailo Fedorov, Ukraine’s deputy prime minister and minister of digital transformation, said in a tweet. “Uniswap has helped the Ukrainian people,” Fedorov said.
An NFT (non-fungible token) depicting a CryptoPunk NFT (non-fungible token) smoking while wearing a blue hat and sunglasses was among the contributions. That NFT was valued at around $200,000 and was transferred to the Ethereum address associated with Ukraine.
A total of $5 million was given to Ukraine by Gavin Wood, who co-founded Ethereum and is now the creator of multichain protocols Polkadot and Kusama. The donation was announced on Ukraine’s official Twitter account.
Managing partner of Blockchain Co-investors, Matthew Le Merle, told Blockworks that bitcoin was founded at a moment of global difficulty, referring to the Great Financial Crisis of 2008-2009. Tens of millions of people are seeing the disintegration of their reality right now in Russia and Ukraine. Because Bitcoin is always there for them and their families when they need it,” says the author.
In the case of cryptocurrency crowdfunding and airdrops, they indicate a possible new route for public acceptance of the sector via established institutions such as government agencies.
To quote Haohan Xu, CEO of Apifiny, “Airdropped tokens will eternally serve as a public and irreversible evidence of anything,” he remarked in an interview with Blockworks. “In many cases, these tokens will not just be receipts, but will also be something of worth.”
According to Xu, the airdrop is not only a gesture of Ukraine’s gratitude, but it also has the potential to be helpful in this circumstance.
“Donations are a straightforward point A to point B transaction,” Xu said. “As the situation in Eastern Europe evolves, it is possible that blockchain-based [decentralized finance] applications may be able to do more good, such as providing financial access when centralized infrastructure is down.”
The modern-day “war bond,” according to Nick Tomaino, general partner at 1confirmation, is funding the Ukrainian national defense via a worldwide cryptocurrency crowdfund and airdrop.
Wars have historically been funded by war bonds, which have been issued by nations such as the United States, Germany, and Canada to collect money for military involvement.
Tomaino said that these bonds were often restricted to domestic activity, with only Americans purchasing Liberty Bonds, for example. Crowdfunding and airdrops based on bitcoin, on the other hand, enable everyone in the world to contribute.
It is not just Ukrainians who benefit from cryptocurrency, according to him. “Cryptocurrency allows Ukraine to quickly gather donations from everyone in the world who wants to support maintaining their sovereignty — not only Ukrainians,” he stated.
“This has the potential to assist in deescalating the perilous position in which the globe is now finding itself.”
While it is difficult to predict the short-term effect of Ukraine’s crowdfunding and airdrop, Le Merle believes that the long-term impact might be very beneficial for adopting blockchain technology.