The government of Ukraine has decided to apply new restrictions regarding withdrawals and exchange of its fiat currency, the hryvnia (UAH).
The government of Ukraine applies restrictions on the hryvnia.
Announced at the end of the last week, the measures aim to stop bleeding and maintain the course of hryvnia as best they can. The country’s Central Bank has devalued the UAH by 25% against the dollar, and withdrawals are now even more limited.
Ukrainians will only be able to withdraw 12,500 UAH per week, compared to 50,000 previously in commercial banks; cash purchases will no longer be accessible unless the amount is deposited for a minimum of three months. Finally, bank cards from Ukrainian institutions now have limits for international transfers.
The government clarified that these measures were temporary and served to support the war effort. Ukraine wishes to maintain its economy at all costs, which has suffered greatly from the conflict with Russia. The hryvnia had already gradually lost value before this devaluation.
As Ukraine’s fiat currency has lost value, locals are increasingly restricted in their fund movements. Mikhail Chobanyan, the founder of the Kuna exchange, told Ukrainian media Forklog:
“We expect an increase in revenue and usage of cryptocurrencies. In Europe, 100,000 hryvnias is nothing.”
Mikhail Chobanyan also believes that this rejection of the UAH will slow down humanitarian aid, which must also adapt.