Ukraine bans Bitcoin purchases with local currency amid martial law

cointelegraph.com:

The National Bank of Ukraine (NBU) continues taking measures to prevent capital outflows amid martial law by enforcing major restrictions on cryptocurrency purchases.

The Ukrainian central bank officially announced Thursday a set of restrictions on cross-border operations, prohibiting individuals from buying cryptocurrencies like Bitcoin (BTC) with the national fiat currency, the hryvnia (UAH).

Ukrainians are now allowed to buy Bitcoin and other cryptocurrencies only with foreign currency, with total monthly purchases limited to 100,000 UAH ($3,300). The relevant limit also applies to international peer-to-peer transactions.

According to the announcement, the NBU has deemed crypto purchases as “quasi cash transactions” alongside operations like electronic wallet deposits, foreign exchange transactions and travel payments. By adopting restrictions on such transactions, the central bank aims to prevent the “unproductive outflow of capital” from the country amid martial law.

“The relevant changes will help improve the foreign exchange market, which is a necessary prerequisite for easing restrictions in the future, as well as reducing pressure on Ukraine's international reserves,” the NBU wrote.

The central bank admitted that the need for international transactions has massively increased amid martial law, with millions of citizens being forced to leave Ukraine. However, the NBU cannot afford “unproductive capital outflows,” which include investing in cryptocurrencies, the announcement notes, adding:

According to the NBU, the Ukrainian government adopted the relevant changes as part of the NBU board resolution from April 20, 2022, which entered into force on Wednesday.

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