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Ukraine Limits Cash Withdrawals And Halts The Use of Electronic Currency

Derek Wolfe

Updated: March 1, 2022

iran freeze bank accounts
Editor’s Note:

EDITOR'S NOTE: With all the modern conveniences that come with digital cash, the risks, however rare or infrequent they may seem, are just as comparable in the negative, if not heavier in burden. Ukraine provides a perfect example. In a time of war, Ukraine cash withdrawals have been severely disrupted. The government has limited citizens’ capacity to make digital withdrawals or payments. The circulation of currency has been suspended. The reasons for this are obvious, and if you’re not up to speed with the financial impact of Russia’s invasion, the PYMNTS article below will give you a quick recap of the details. Although physical infrastructure is certainly at risk as the fighting on the streets has intensified, there may be something comforting to those who’ve stashed away a little physical cash. Should the value of their currency undergo a significant drop amid the ongoing conflict, there may also be some comfort for those who’ve stashed away safe-haven assets like gold and silver. But for now, wealth may be the least of Ukrainians’ concerns, considering the dangers that lay ahead in the coming days.

Following the declaration of martial law in Ukraine, the central bank suspended the country’s currency markets, stopped the circulation of all securities, limited cash withdrawals and halted the use of electronic currency and digital wallets.

As Russian troops entered the country, the National Bank of Ukraine passed several temporary resolutions, including capping daily cash withdrawals to the U.S. equivalent of roughly $3,339.13 and suspending digital money transactions.

The wording of the central bank's resolution calls on “issuers of electronic money to suspend the issuance of electronic money, replenishment of electronic wallets with electronic money, distribution of electronic money.” Cryptocurrencies weren’t specifically mentioned.

See also: US, Europe Levy Russia Sanctions, but All-out SWIFT Ban Not Likely Yet

The PFTS Stock Exchange in the country postponed all activity Thursday (Feb. 24) as Russian tanks and ground troops entered Ukraine and airstrikes attacked the country’s capital and over 12 other cities, the Wall Street Journal reported.

President Biden said Putin’s attack on Ukraine had zero justification and vowed there would be further action taken against Russia.

“Russia alone is responsible for the death and destruction this attack will bring, and the United States and its Allies and partners will respond in a united and decisive way. The world will hold Russia accountable,” Biden said in a statement.

Read more: Russia May Turn to Crypto to Go Around US Sanctions

The price of oil spiked to $100 a barrel for the first time since 2014 on Thursday, while European stocks dropped 2.75%, Reuters reported. The Russian ruble declined almost 7%, and Russia’s central bank banned short selling and over-the-counter markets after the Moscow stock exchange fell 10%.

British Prime Minister Boris Johnson tweeted that he was “appalled by the horrific events” in Ukraine and he is in talks with President Zelenskyy regarding “next steps.”

“President Putin has chosen a path of bloodshed and destruction by launching this unprovoked attack on Ukraine. The U.K. and our allies will respond decisively.”

Originally posted on PYMNTS.

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