Cryptocurrencies like bitcoin, he said, were “more convenient and reliable than cash,” as they enabled aid workers to receive donations instantly from anywhere in the world. Plus, bitcoin couldn’t be frozen, like Come Back Alive’s Patreon platform had been on the day the Russian attack began.
Naumenko’s interest in Bitcoin was initially sparked in part by the staggering collapse of Ukraine’s currency, the hryvnia. In the time since Satoshi first posted the idea for Bitcoin online in late 2008, 100 hryvnia has gone from buying you $20 to, today, only getting you around $3.
Naumenko was inspired by how Bitcoin could improve civil liberties. This new currency, he told me, could help dissidents and opposition politicians raise money despite the State’s desire to freeze them out of the financial system; could allow people in pain to buy marijuana that the government didn’t want them to buy; and could prevent police from spying on the bank accounts of sex workers.
In 2018, Naumenko got the chance to work with Bitcoin giants like Greg Maxwell and Pieter Wuille as an intern at Blockstream, eventually co-authoring a paper with Maxwell and Wuille on a proposed Bitcoin improvement called Erlay, which could make the network more efficient and resilient.
Just days after the invasion, Naumenko released “CoinPool,” a new implementation of Bitcoin which would allow many users to share the same “UTXO,” or spendable piece of bitcoin.
As of April 30, the EU had paid Moscow a staggering €43 billion for fossil fuels since the invasion. Despite cutting Russia out of the SWIFT network, despite the G7 freezing its national savings, and despite many major international companies refusing to do business in Russia, European energy purchases are estimated to be able to sustain Moscow’s war for the next two years.
30% of Ukrainians have fled their homes. The refugee crisis is comparable in scope or even larger than similar crises in Syria or Somalia or Venezuela, but it’s taking place in a matter of days and weeks, not years.
On the eastern front, Russian forces are committing monetary imperialism, trying to replace the hryvnia with the ruble town by town.
It is estimated that as many as 170,000 tech workers alone have fled [Russia] or will soon flee.
Aleksey’s website, 21ideas.org, is the most extensive Russian-language Bitcoin resource on the internet, run impressively from one of the most unlikely places on Earth.
The 1990s “were a disaster for all of us. The purchasing power was sucked out of our currency. Everyone was a millionaire. but it didn’t mean anything.” Local fiat, he said, has lost half its purchasing power since August. And there’s Luhansk-specific inflation, too. Inside the LPR, tea might be 200 rubles, but in Russia, just a few minutes away, it can be 120.
Aleksey said he “wasn’t surprised” that the Ukrainians raised money via cryptocurrency, but said he doesn’t think bitcoin matches Putin’s goals. “We’re getting close to totalitarianism in Russia,” he said, “and Bitcoin doesn’t fit that framework.”
In Russia, it’s forbidden to accept bitcoin or any other cryptocurrency in exchange for goods or services. Only the ruble is legal tender. But there are still gray markets and people interacting in a peer-to-peer way. “Life,” he said, “finds a way.”
His previous hosting service Ghost doesn’t accept bitcoin and no longer accepts Russian credit cards because of Western sanctions. But the hosting service Njalla does accept bitcoin, so his resource lives on, helping people learn how to escape from financial repression.
If we had to flee today,” he said, “even if our house burned down, we’d be OK. I have my seed phrase in my head. I’ve memorized the 12 sacred words. I hold the key to our future.”
A Moscow-based Russian developer named Anton — who created Lnurl-pay, a way to spend Lightning and pay out in rubles or hryvnia — has recently been arrested in Moscow for protesting the war and wrote a scathing post condemning the invasion. The creator of the popular Simple Bitcoin Wallet, Anton Kumaigorodski, is a Ukrainian developer who took up arms to defend his country. Hennadii Stepanov, a developer supported by Brink, a London-based nonprofit, also hails from Ukraine.
[Up through early April,] assistance began coming in through bitcoin and other cryptocurrencies from individuals worldwide faster than aid from any government. He said, $20 million was raised in less than two days.
In early April, I recall helping to send money to a contact in Poland to buy satellite phones. It was Friday evening in Eastern Europe and a bank wire wasn’t going to get the job done. So we sent Bitcoin and the phones were purchased and on their way into Ukraine by Sunday morning. To reiterate: This would have been impossible to do with the legacy banking system.
Crypto is the new king of money in Ukraine.” As the landing page of Kuna says, “In crypto we trust, for Ukraine we pray.”
He estimates that more than 100,000 Ukrainians left the country with cryptocurrency and acknowledges how useful it is as a refugee technology.
Before the invasion, Naumenko was involved in a bunch of Bitcoin and startup meetups in Kyiv. Each one had a Telegram group, and he’s marveled at how nearly everyone in these groups has become an aid worker. “No one is getting paid for it,” he said, “they just do it.”