The Ukrainian government is planning to block bitcoin accounts used by separatists operating in the Eastern regions of Lugansk and Donetsk, reports suggest.
“The financing of terrorism in the territory of Ukraine is carried out not only by the cash coming from Russia, but also through attempts to make money through electronic systems […] we will work to block cards and bitcoin accounts being used by the separatists.”
The chairman did not explain how the security service was planning to block the accounts.
In the meantime, Reddit users have fuelled speculation that Ukranian exchange website BTCTrade.com.ua may be inaccessible to domestic Internet users.
Confirmation, which has been loosely translated, came via Twitter: “We are under suspicion by Privatbank. We apologise for temporarily suspending payouts in Hryvnia.”
Despite claims that bitcoin has been used to fund terrorist activity in Eastern Ukraine, the digital currency has also played a role in the aftermath of Kiev’s protests.
After President Viktor Yanukovych’s removal from office and the subsequent eruption of violent demonstrations across the country, people rallied to campaign for funds.
Sending money to Ukraine, however, was not an easy feat. PayPal would only allow money to be sent out of the country, while international bank transfers could take days to clear.
Photos of protesters holding campaign signs to raise funds directly via bitcoin in Kiev’s central square began to surface online. The insurgents were holding up QR codes, as part of a co-ordinated effort to collect instantaneous donations from everywhere in the world.
At press time, BTCTrade.com.ua and SBU had not responded to requests for comment.
Image via Shutterstock.
The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.