The Central Bank of Ukraine banned crypto transactions via bank cards to prevent its national currency, the hryvnia, from being used on crypto exchanges. Similarly, Binance and the country’s leading exchange Kuna have confirmed the suspension of crypto transactions via bank cards in Ukrainian hryvnia. 

Following Ukraine’s decision to temporarily stop hryvnia use on crypto platforms, it has become a critical issue for Ukrainian residents to withdraw from or move funds to another exchange.

Meanwhile, the world’s largest crypto exchange, Binance, suggested its community use peer-to-peer (P2P) trading solutions as an alternative option. It doesn’t require any third-party counter, like banks, to trade with another user. This way, investors can continue their trading seamlessly.

Binance Suggests Using Its P2P Trading Platform

While speaking to its community in a post on a Telegram channel, Binance affirmed;

Currently, fiat channels, namely input and withdrawal through a bank card and other payment services, are temporarily suspended among cryptocurrency exchanges throughout Ukraine. We suggest using the P2P service so that you can continue to use Binance comfortably.

Michael Chobanian, the founder of the Kuna exchange, also affirmed the inconvenience stemmed from regulatory measures. Though he admitted that such actions would not impact the Bitcoin ecosystem. He added;

We are looking for ways out of the situation, under the threat of stopping the entire Ukrainian crypto/card UAH market [translation].

Speaking on the issue, Michael Chobanian noted in a statement that restrictions on non-cash hryvnia transactions appear as part of the regulatory’s ongoing efforts to tackle money laundering and tax evasion activities being conducted through online gambling websites.

Illegal Gambling Channels Launder 54 Billion Hryvnia Annually

The exchange’s founder further cited claims of a Ukrainian lawmaker, Oleksiy Zhmerenetsky, who affirmed that the amount swapped through illegal gambling amounted to 54 billion in hryvnia annually, equated to around 1.5 billion U.S. dollars. 

Considering the fact that cryptocurrency has proved to be handy for Ukraine following Russia’s invasion, the decision to ban hryvnia use on crypto exchanges becomes shocking news. 

The country has raised over $212 million only in cryptocurrency for defense and humanitarian following February 2022, per the report published by blockchain intelligence firm, Elliptic. And $70 million of these charity funds has been sent directly to government-issued addresses. 

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Hyrvnia-related withdrawing and deposit issues initially started in September 2022 due to the negative regulatory stance. And since last December, the restriction imposed by the National Bank of Ukraine has become stricter, Chobanian revealed. 

He continued;

The NBU banned P2P and A2C transactions for financial companies, and since all crypto exchanges work through them, as a result, everything is gone for them.

Chobanian expressed concerns that newly imposed limitations will specifically affect medium-sized crypto companies and crypto donations. And it will also damage the global reputation of Ukraine as an emerging industry leader.