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Since the Russian invasion of Ukraine on February 24, 2022, both sides have used blockchain technology to aid their efforts. Many campaigns have sought to take advantage of key developments in the crypto ecosystem to help raise funds – from decentralized finance (DeFi) to crypto pre-paid cards.
Using its internal proprietary data, Elliptic conducted an in-depth analysis of the use of cryptoassets on both sides of the war – from humanitarian causes to sanctioned groups suspected of war crimes.
In this excerpt from Elliptic’s “Crypto in conflict” In the report, we reveal the total amount raised by groups supporting both sides since the start of the war and show where it came from.
Elliptic has analyzed over $230 million worth of blockchain activity. The chart below shows that pro-Ukraine fundraising campaigns – many supported or initiated by the Ukrainian government itself – account for the majority of these funds.
Receiving over $212 million in crypto assets, pro-Ukraine fundraisers far outnumbered pro-Russian crypto donations, which totaled $4.8 million. An additional $0.7 million was raised by anti-government entities in Belarus, which is a key ally of Russia.
The figures for Ukraine mainly consist of donations to the official wallets of the Ukrainian government ($83.3 million). In the first four days after the beginning of the invasion, about 30 million dollars were collected.
Pro-Russian crypto donations
Unlike the highly publicized crypto campaign by the Ukrainian government and various charities, crypto donations on the Russian side were more limited in scope and publicity. Russia itself has historically taken a legally restrictive stance towards crypto-assets, with the country’s central bank advocating a blanket ban on the use of cryptocurrencies just before the war.
Although Russian officials praised the acceptance of bitcoin as payment for oil and gas exports, the country’s crypto-averse attitude likely contributed to the relatively limited use of cryptocurrencies to finance the invasion. Most of the identified $4.8 million in cryptoassets raised were donated to military fundraisers.
Types of pro-Russian fundraisers by value of cryptoasset donations in USD
The most popular crypto asset
Unlike pro-Ukraine fundraisers, the majority of pro-Russian crypto donations were in Bitcoin, with relatively few attempts to use the DeFi protocol to facilitate campaigns. ETH and other assets heavily used in the DeFi space therefore contributed relatively little.
The few times pro-Russian entities have tried to emulate Ukraine’s success by engaging in DeFi projects – such as NFT collections – have almost always ended in failure.
Blockchain activity over time
Before the invasion, pro-Russian fundraisers routinely managed to collect less than $1,000 in crypto-asset donations per month. They have soared since the full-scale invasion, and pro-Russian fundraisers have managed to maintain a mostly steady flow since then.
In June and July, there were large movements of wallets – not necessarily attributable to donations – in wallets specifically controlled by one military fundraiser (MOO “Veche”).
Accounts for BTC and ETH accounts in a sample wallet without an exchange.
Origin of donations
Despite the limited scope, separatist fundraising campaigns often have links to cybercrime, sanctioned entities or entities that openly advocate or glorify potential violations of international law. Dark markets represent the fourth largest known source of donations for pro-Russian fundraising campaigns.
A significant portion of donations, however, came from mixers, with smaller amounts coming from similar obfuscation protocols, such as private wallets and coin exchange services. This indicates possible efforts to conceal illicit funds prior to donation.
The origin of donations to a sample of pro-Russian wallets
Based on a sample of $2.5 million BTC, ETH and USDT, USDC and DAI on the Ethereum blockchain.
Unauthorized funds
Elliptic’s analysis of pro-Russian wallets exposed the massive cybercriminal infrastructure that underpins the blockchain activities of many of these groups.
More than a dozen cryptoassets received by pro-Russian wallets originate from illegal activities – ranging from dark web markets to sanctioned exchanges. Meanwhile, less than 2% of Ukraine’s donations come from illicit sources – mostly from the US-sanctioned mixer Tornado Cash.
Proportion of pro-Ukrainian and pro-Russian crypto asset donations by origin
Accounts for sample BTC, ETH and USDT, USDC and DAI (on the Ethereum blockchain).
Furthermore, although not at great risk of catching up, pro-Russian donations have gradually increased their momentum compared to pro-Ukrainian donations since May 2022. In June of that year, pro-Russian campaigns raised more BTC and ETH than Ukrainian campaigns for the first time and almost repeated this trend in October.
In our upcoming “Cryptocurrency in conflict” In the report, we will expose the connection of pro-Russian groups with cybercriminals. It will also reveal profiles of the specific networks that facilitate them, their activities and intentions “off-chain”.
Many of these findings – which include the glorification or incitement of potential war crimes, crimes against humanity, the use of nuclear weapons and violent anti-Semitic or homophobic rhetoric – are a cause for serious concern across all relevant industries.
Elliptic users will also be able to view all entities – among others – identified in this report. In the case of pro-Russian entities engaged in criminal activities or fundraising, they will be able to incorporate such groups into their risk rules and manage the risk of blockchain exposure accordingly.
Pro-Ukrainian crypto donations
The desire and determination of the crypto community to directly donate and use their resources to help Ukraine’s resistance against a full-scale invasion was swift and unparalleled compared to any previous conflict.
In addition to humanitarian aid and the Ukrainian government’s own crypto campaigns, the desire to contribute has fueled innovation and development within the crypto ecosystem. Apart from official government wallets, blockchain projects are the second largest source of pro-Ukraine crypto donations.
Types of pro-Ukraine fundraisers by value of cryptoasset donations in USD
The most popular crypto asset
A noticeable trend observed in pro-Ukraine fundraisers is their relatively less reliance on Bitcoin – the original cryptocurrency which is the most traded by market cap. Despite its continued dominance in the crypto ecosystem, Bitcoin does not allow for web3-based innovation.
These innovations – such as DeFi, NFTs and DAOs – are more mainstream on blockchains like Ethereum, of which its parent asset Ether is the second largest by market capitalization. Such blockchains have enabled fundraisers to leverage web3’s unique capabilities to launch successful DeFi-powered donation campaigns.
Crypto assets received in the wallets of pro-Ukrainian fundraisers
Blockchain activity over time
Over 80% of donations took place in the last four days of February or March 2022 – shortly after the full-scale invasion began – before gradually tapering off. In November 2022, a sample containing the most popular pro-Ukrainian donation wallets received just under $0.6 million in BTC and ETH.
Origin of donations
Elliptic’s analysis of nearly $96 million in traceable Bitcoin and Ether donations shows that the majority of these funds originate from crypto-asset exchanges. A significant portion comes from NFT Marketplaces and, to a lesser extent, token contracts and decentralized exchanges – illustrating web3’s significant role in facilitating fundraising.
The use of mixers has been attributed to sympathetic donors from Russia or pro-Russian jurisdictions who are concealing their donor activities. Ethereum’s Russian-born founder Vitalik Buterin later commented that he used Tornado Cash to donate to Ukraine – in defiance of the mixer, which was sanctioned by the United States in August 2022 over money laundering concerns.
In addition to Buterin – who has publicly donated at least $5 million to pro-Ukrainian causes – several other well-known beneficiaries have also given. They include Polkadot co-founder Gavin Wood ($5.8 million) and Tron founder Justin Sun ($200,000 at least).
Origin of BTC and ETH donations to a sample of pro-Ukrainian causes
Based on a sample of $95.8 million BTC, ETH and USDT, USDC and DAI donations on the Ethereum blockchain.
Download the Crypto in Conflict Report
