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Ukraine sells a Cryptopunk NFT to aid war efforts

In a Twitter post on 20th June, Alex Bornyakov, deputy minister of digital transformation of Ukraine, said that they have sold CryptoPunk #5364 non-fungible token (NFT) to an anonymous buyer for 90 Ethereum (ETH) and raised more than $1,000,000 at current market price for Ukraine’s war effort. This NFT was donated to Ukraine as a part of AidForUkraine campaign back in March, and was valued at $2,600,000 back the time.

Cryptopunks are one of the most sought after NFT collections in the space. Together with Bored Ape Yacht Club, the collections are to NFT space, what Bitcoin and Ethereum are to crypto. Resultantly, Cryptopunks exchange hands for $24 million and over.

Cryptopunk in Ukraine

On March 2nd, about a week after Russia’s invasion of Ukraine began, an anonymous wallet donated CryptoPunk #5364 to Ukrainian crypto fund. This is just one of many NFTs and crypto donations that Ukraine received as the blockchain community rallied around the country. Over $135 million in cryptocurrency donations were raised by mid-May, as corroborated by the country’s Deputy Minister. While the Punk in question was valued at a higher dollar amount before the recent market crash, this is clearly still a significant boost for the fund. By the same token, the sale was significantly above the current CryptoPunks floor price, which is sitting at 67.45 ETH.

CryptoPunk values have skyrocketed in the recent month, fuelled by news of Yuga Labs hiring a new brand lead for the collection. 

Digital assets as the much needed help

Since Russia invaded Ukraine on February 24, an outpouring of support for Ukraine has streamed in from various avenues and personalities from across the world.

Apart from humanitarian aid from various organizations, Ukrainian officials have been appealing to the global crypto community to support their fight by donating in crypto assets while artists have actually resorted to releasing non-fungible tokens (NFTs) themed around Ukraine and channeling the proceeds to the cause.

In the first week of March, $6.75 million was raised by a crypto group, through the sale of an NFT of the Ukrainian Flag. A few weeks back, this year’s Eurovision champions, the Ukrainian rap group Kalush Orchestra, auctioned off their trophy from the music competition to raise almost $1 million in Ethereum for the fund.

To sum up, Crypto fund helps purchase essential, non-lethal items for Ukraine’s military. This includes medical supplies, food for civilians, and protective gear for the country’s soldiers. Notably, while the government of Ukraine endorses the fund, it does not actually control the fund. In other words, the Ukraine government itself did not sell the CryptoPunk. Rather, the Ukrainian crypto exchange Kuna operates the treasury, funding the purchases by volunteers.

President Volodymyr Zelenskyy reiterates his belief that digital assets can bring about an economic breakthrough for countries like Ukraine, considering Russia’s threats to its banking system.

The sour bit

It has also highlighted potential drawbacks, as well. The International Monetary Fund warned in April that Russia could skirt economic sanctions by mining cryptocurrencies—although U.S. Treasury Secretary Janet Yellen says the practice hasn’t been widely observed.

Further, crypto and NFT donations are fully exposed to the current crypto bear market. Ethereum’s price has plummeted almost 70% in the last ten weeks, inexorably affecting the fundraising potential of NFT collections like Cryptopunks built on Ethereum.

Naturally, attention on the conflict in Ukraine has dipped since the early days of the conflict. In any case, it’s certainly encouraging to see that the NFT space continues to find ways to support Ukraine.

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