UPDATE: Donations reached 15 BTC (02/26/2022 15.45 CST)
The Ukrainian government’s Twitter account has posted a bitcoin and ethereum address in a call for donations. “Stand with the people of Ukraine. Now accepting cryptocurrency donations. Bitcoin, Ethereum and USDT.” states the post.
For the first time in history, a government has publicly posted a Bitcoin address to accept donations. Regardless of the purpose and meaning of the donations, the fact alone sets a precedent.
It is uncertain which government entity is holding the private keys of these addresses. At the time of writing 11 Bitcoin and 130 ETH have been donated, which combined, accounts for close to 1 Million USD.
The use of proceeds are also unclear as no detailed information can be found on how the funds are invested or distributed. Some Twitter users speculate about the possibility that the addresses could also be held by individuals inside the government who control the Twitter account and the money could go just to individuals pockets. As a government is not a charitable organization and usually is expected to be financed through taxation in order to fight corruption, the fundraiser also raises critique.
After a private charity has collected over five Million USD (145 BTC) to support Ukraine this week, now the government itself took action. It was quick to adopt this new way of fundraising using bitcoin. Whether donations are foreign or domestic is unknown. However, it is clear that bitcoin changes the game once again.
Bitcoin is untamed and censorship resistant on the protocol level. To setup a wallet takes a few minutes and sending money does not require anyone to verify his identity. Therefore bitcoin is a universal form of digital cash that can be used for any purpose, good or bad.
It challenges everyone to rethink money and to find new solutions to deal with it. How should governments finance themselves when they cannot steal from their population easily? How can wars be afforded without credit expansion? How can defense funded?
All these questions need answers as bitcoin is marching forward to hyperbitcoinization. Another user mentioned that Ukraine already has large national Bitcoin reserves but was corrected that it is individuals who control the keys, not the treasury.
We observe this new dynamic unfold and conclude that bitcoin changes everything.