Supporters said it would help displaced people get money faster and limit loss or theft in transit — but some skeptics say adding another layer to getting help at a time when the cryptocurrency market is in turmoil could be problematic and risky.
“They are basically telling people to get into the cryptocurrency world,” said Molly White, a cryptocurrency critic who writes the Web3 Is Going Just Great blog. There are risks associated with the cryptocurrency industry.
UNHCR was not available immediately for an interview.
“Speed is at the heart of humanitarian action,” said Karolina Lindholm Pelling, UNHCR Representative in Ukraine, in a statement announcing the move. “It is also essential to provide people with a range of options for receiving assistance, because one size does not fit all.”
The cryptocurrency world has been in turmoil for the past few months. FTX, a major exchange, has applied to be included in the list. bankruptcy. Its former CEO, Sam Bankman FriedA series of events were held in the Bahamas. fraud charges. Bitcoin, a well-known cryptocurrency, has seen a significant decline in value.
Other cryptocurrencies are stable, such as TerraUSDIn recent months, it has fallen apart.
However, cryptocurrencies already played a significant role in the war. Officials from the government claim that the government raised almost $100 million in cryptocurrency donations during the war’s early days to help fund operations. in March.
The United Nations will now pilot its crypto-assistance program within the Ukrainian cities Kyiv, Lviv, and Vinnytsia. Officials claimed that the program has been in operation for six months. It will soon be expanded to include more “war-affected” citizens within Ukraine and Ukrainian refugees by 2023. It is not clear how effective the tests were.
To receive the money, people who have been displaced will need to download Vibrant (a virtual wallet app) onto their smartphone. The USDC amount of the money will be transferred into their account. They can then convert the cryptocurrency into dollars, euros, or any other local currency at any of the 4,500 MoneyGram locations in Ukraine.
The currency is available on the Stellar blockchain, which is a cryptocurrency exchange network. The software was created in collaboration with the Stellar Development Foundation, an organization that advocates the use the Stellar blockchain.
Stellar officials stated that in the past, humanitarian aid projects were limited in scope because of geographic restrictions. However, the use of cryptocurrency allows it expand around the globe, raising concerns for others.
Oleksandr Bornyakov (Ukraine’s deputy minister for digital Transformation) said that cryptocurrency could be used to distribute humanitarian aid. This would be vital for the safety and security of his citizens.
“For fleeing Ukrainians, and primarily those whose bank accounts are not accessible, this pilot project…will serve a potential survival line,” he stated in a statement.
White, a cryptocurrency critic, stated that people downloading a wallet for cryptocurrency exposes them to the volatile world of cryptocurrency.
“Most cryptocurrency wallets are constantly trying to get you to buy more cryptocurrency,” she added, leading her to worry that people might end up getting sucked into other cryptocurrencies like bitcoin or “crazy.” alternative currenciesThis is what many people consider akin. gambling.
She said that the real winners of these programs are the cryptocurrency companies who get coverage claiming they have a strong reason to exist.
She stated, “It doesn’t actually help people.”
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