UN sends displaced Ukrainians to USDC for conversion into local currencies
For displaced people around the world, carrying cash is risky as it can be lost or stolen.
To avoid this while distributing aid to internally displaced people from Ukraine and those affected by the Russian invasion, UNHCR, the United Nations refugee agency, is turning to crypto.
Through a new blockchain-based utility, UNHCR USDC, a stablecoin pegged to the US dollar, will be pushed to eligible recipients’ Vibrant digital wallets running on the Stellar blockchain. Aid recipients can then collect the funds in dollars, euros or local currency at a MoneyGram location, of which there are 4,500 in Ukraine, the release said.
Holding crypto funds on a cellphone allows travel across borders or across long distances without worrying about converting cash into other cash. Funds will be distributed to those hardest hit by the war to cover things like rent, food, medical care and winter heating.
“UNHCR has worked for years with the technology sector, which has played a crucial role in helping us innovate to deliver aid faster, as speed is of the essence in humanitarian response,” said the UNHCR representative in the Ukraine, Karolina Lindholm Billing, in the statement.
Despite a difficult few months for crypto, including last month’s collapse of FTX and the indictment of former CEO Sam Bankman-Fried, the UN’s bailout program illustrates a real-world use case for cryptocurrencies. Months after Russia invaded Ukraine, crypto has played an outsized role in channeling funds to refugees and the Ukrainian government.
In March, Alex Bornyakov, Ukraine’s Deputy Minister at the Digital Transformation Ministry, said the country had raised almost $100 million in crypto donations. Mykhailo Fedorov, Ukraine’s Deputy Minister of Digital Transformation, released a series of NFTs entitled META HISTORY: Museum of War aimed at raising money for the country’s defense.
The UNHCR program is being piloted in the Ukrainian cities of Kyiv, Lviv and Vinnytsia, in cooperation with the Stellar Development Foundation, and will be expanded to other cities. The UN said in a statement that the initial phase of the project is designed specifically for Ukraine but could be expanded to other parts of the world.
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