Preliminary Analysis of Bitcoin Donations in Ukraine

0x00 Background

On February 26, the Ukrainian government’s official Twitter account issued a message asking the entire network to donate through cryptocurrency to support the Ukrainian people. As of March 4, the Ukrainian government and non-governmental organizations have received more than 60 million US dollars in donations through Bitcoin, Ethereum, TRON, and Dogecoin.

Not long ago, Ukraine officially legalized Bitcoin and other cryptocurrencies on February 17. Mykhailo Federov, the Ukrainian Minister of Digital Transformation, said on Twitter that this move would reduce the risk of corruption and prevent fraud in emerging digital currency exchanges. The official Bitcoin donation address disclosed this time is the address of the Ukrainian exchange Kuna.

As the conflict between Russia and Ukraine escalates, the trading volume of the Ukrainian exchange Kuna has surged. According to data from Coingecko, Kuna's trading volume more than tripled in the 24 hours from February 24 to February 25.

The surge in cryptocurrency trading may be related to some financial institutions restricting Ukrainians from using bank accounts and foreign currencies. On February 24, the Central Bank of Ukraine issued a regulation stipulating that banks will limit daily cash withdrawals from accounts to 100,000 hryvnias (3,391 U.S. dollars), prohibit the issuance of foreign currency cash, and suspend overseas foreign exchange payments to prevent panic and minimize economic fluctuations.

0x01 Analysis

We started with the address 357axxx1P, which is used by the Ukrainian government to receive Bitcoin donations, and analyzed the donation trends and sources. As of the time of analysis, this address has received 14,140 donations from all over the world, with a total of 239.8 BTC (worth about 10 million US dollars at the time of analysis).

trend

On February 27, the number and total amount of donations in a single day reached a peak (4,009 donations in a single day, accumulating 85.36 BTC). In the following days, the number and total amount of donations fell back, but the address received thousands of donations every day. Overall, the number and total amount of donations showed a trend of increasing first and then slowing down.

From February 26 to date, the number and amount of donations received by address 357xxx1P changes with date

Of the 14,140 donations received by this address, 48.95% of the donations were between 0.001 and 0.01 BTC (worth about 41 to 410 USD at the time of analysis), totaling 6,922 donations. 41.7% of the donations were less than 0.001 BTC, totaling 5,896 donations. Together, they accounted for 90.65% of the total donations, indicating that the vast majority of donations were within 0.01 BTC.

The number and total amount of donations received by address 357xxx1P in different amount ranges

source

By tracing the source of the donated funds (depth 3), it can be found that about half of the funds come from on-chain entities such as exchanges, online payments, and mining pools. Among them, 84.3% of the funds come from Binance, the exchange with the largest trading volume at present (at the same time, Binance officially donated 16,042 BNB worth 6 million US dollars to Ukraine on February 27). Surprisingly, 1.215 BTC of donated funds were traced back to Gambling and Dark Market.

The result of tracing the source of funds at address 357xxx1P for 3 hops