Ukraine has implemented new regulations that limit the use of fiat currency, which will benefit the crypto economy. Due to the basic financial condition of the nation changing as a result of the ongoing armed conflict with Russia, the National Bank of Ukraine had to implement certain new regulations.
NBU has now reduced the value of the Hryvnia by 25% in relation to the US dollar. The bank has further imposed new restrictions on banking activities. The decision to modify the Hryvnia exchange rates to US dollars and limit the amount that may be exchanged could contribute to the growth of the cryptocurrency industry.
In the near future, people may decide to switch to cryptocurrencies in order to circumvent Fiat constraints. These Fiat limits will aid the cryptocurrency economy, according to the local cryptocurrency sector’s spokesperson in Ukraine.
The new laws have updated that banks may only offer non-cash foreign currency to clients who have deposited the full purchase price for a minimum of three months without the right to cancel the agreement.
The New Restrictions Are Interim
The withdrawal cap of 50,000 hryvnia has been replaced with a weekly limit of 12,500 ($340) as part of the restrictions. Furthermore, the threshold for peer-to-peer transfers using cards issued by Ukrainian banks has been lowered from 100,000 to 30,000 hryvnia.
Even the monthly cap on cross-border payments has been set at 100,000. However, it appears that the limitations are just transitory in nature. The NBU’s governor, Kirill Shevchenko, has stated that these measures are just temporary.
He has promised that all of these limits are, in reality, unique measures that must be adopted as a result of the ongoing conflict. To keep the economy operating, all of these efforts have been taken. The Ukrainian people have been significantly impacted by these activities.
Millions of Ukrainian nationals were compelled to flee the nation and are now battling to go back home. Returning to Ukraine has become more difficult for the citizens as a result of the limitations.
An Increase In Crypto Interest
The National Bank of Ukraine’s regulations have recently increased interest in cryptocurrency.
In a recent interview with cryptocurrency news site Forlog, Mikhail Chobanyan, the creator of the Ukrainian cryptocurrency exchange Kuna, said,
We expect an increase in turnover and use of cryptocurrencies. In Europe, 100,000 hryvnias is nothing,” the entrepreneur added.
Chobanyan also emphasized how the new restrictions have made it harder for volunteers to do their jobs. The majority of humanitarian aid has been purchased using cards issued by Ukrainian banks that are privately held.
The cash must be totally routed through cryptocurrency due to the constraints. Chobanyan has also referred to the NBU’s position as aggressive and warned that as a result of such strict measures, Ukrainian banks and the national budget will suffer.