The crypto crash has hit Ukraine's fundraising, so its deputy leader touted a rap appeal for donations at Davos

·3 min read
Ukraine programmer
A specialist of IT company Infopulse is seen in his office in Kiev, Ukraine.REUTERS/Gleb Garanich
  • The recent crypto crash has hit war-torn Ukraine's fundraising efforts following the Russian invasion in February.

  • It initially raised over $60 million in crypto in its first month, but the total is now $51 million after the rout.

  • Ukraine's vice prime minister presented a rap video to rally support at the World Economic Forum in Davos on Tuesday.

The recent cryptocurrency rout has taken a toll on Ukraine's fundraising efforts, leading the country to try to rally the crypto community to make more donations.

Having used social media to attract support, the government's latest move is to back "Invest in Peace, Bro," a rap video presented by its vice prime minister at the World Economic Forum meeting in Davos.

Ukraine began seeking donations in cryptocurrency when Russia invaded in late February, and within a month, it had raised $60 million in crypto, according to the state's Aid for Ukraine fund.

Digital money continued to come in, and the fund was able to spend $45 million on equipment for Ukraine's army before the crypto crash, the country's deputy minister for digital transformation, Alex Bornyakov, told Reuters.

By mid-May, though, the total in the fund's coffers was $51.5 million in crypto, he added.

Cryptocurrencies have fallen in 2022 as rising inflation and interest rates, the war in Ukraine, and a slowdown in China have caused investors to ditch assets deemed to be risky. But they suffered a brutal meltdown in early May, after the terra stablecoin lost its peg to the US dollar and collapsed into a "death spiral".

Bitcoin, the biggest cryptocurrency by market value and one of the coins accepted in Ukraine's fundraising, has lost over 20% in May so far, following more than a 17% drop in April. For the year to date, the token is down more than 35%.

"Peace comes at a price, but the first wave of donations have subsided," Sergey Vasylchuk, CEO of staking provider Everstake, told Tech.EU

Given that, Everstake created what it describes as a rap video, "Invest in Peace, Bro," to call on the crypto community for further support. The vice prime minister of Ukraine, Mykhailo Fedorov presented it on Tuesday at the World Economic Forum in Davos, Switzerland.

The pigeon-themed video pokes fun at other ways of laying out crypto — like buying NFTs or fancy cars — to underline the message that holders will feel good if they contribute to Ukraine's efforts instead.

Jess Symington, a research lead at Elliptic, told Insider in the wake of the Russian invasion that crypto assets provide an alternative funding route for people who can't navigate the international banking system, but do have access to bitcoin and can donate it easily.

"This is potentially a new factor in complex situations — the idea of fundraising and crowdfunding for defense efforts," she said.

Read more: Pussy Riot-led UnicornDAO raised $4.5 million to support women and LGBTQ+ artists. Here's an exclusive look at the 8-slide pitch deck that helped onboard members like Yuga Labs, Beeple, Sia and Grimes.

Read the original article on Business Insider