People outside Red Cross tents
Photo: Yuriy Duachyshyn/AFP via Getty Images

How war in Ukraine became war on the blockchain

Source Code

Good morning! Donating to Ukraine’s war effort is commendable. But the last thing Ukraine needs is an NFT of an alien dog. I’m Owen Thomas, and while I haven’t been to Nice or the isles of Greece, I’ve been to Makhachkala, and that has to count for something.

Cool story, crypto bro

If there’s one thing Ukraine does not need right now, it’s $19 worth of Dogelon, or 50,000 AssangeDAO coins, or an NFT of an alien shiba inu. But that’s what the war-torn country got, along with more than $50 million of cryptocurrency since it opened up bitcoin and Ethereum wallets and announced the addresses on Twitter last week.

The bitcoin, ether and USDT that landed there will help the country’s war effort. But the random assortment of coins getting sent Ukraine’s way points to a problem with the narrative of crypto as the new war bond: Along with the fungible tokens, you get a lot of funk.

The novelty of crypto is driving donations. World War III? More like World War Web3, am I right?

  • For a generation that’s only experienced war as a video game, sending crypto to the front seems like a natural move.
  • The pro-crypto argument: Cryptocurrency can route around financial barriers and move funds quickly to places where they’re needed. “It’s actually a massive step up from the pallets full of cash that were previously sent into conflict areas,” KRH Partners’ Tomicah Tillemann told The Washington Post.
  • But Ukraine isn’t under sanctions. The Ukrainian government placed some restrictions on internal money movements as it imposed martial law, but the world’s financial plumbing remains open to the country. Some money-transfer companies have even waived their usual fees, making sending cash there cheaper.
  • Ukraine’s army needs weapons, ammunition, fuel and food, not digital artwork. To buy those, it’s converting the crypto it received into … pallets of cash.

The blockchain is making Ukraine’s fundraising public. The transparency is arguably helping fuel more donations.

  • People think of crypto as private and anonymous, but it’s not, really. If you have someone’s wallet address, you can see all of their transactions recorded on the blockchain. Sites like Etherscan make this easier. For donors, it can be satisfying to see the money moving in real time. People in Silicon Valley call this “social proof,” and the blockchain provides it.
  • You don’t need the blockchain for this, though. GoFundMe has a Ukrainian relief hub where you can see exactly how much various Ukraine-related campaigns have raised.
  • And while you can see the money going in and out of Ukraine’s official wallet, there’s no way to know how it’s being spent. The blockchain is designed to be trustless, but on this, you’ll just have to trust someone.
  • For some, that’s the point. Patreon removed a Ukrainian nonprofit’s campaign for violating its rules on funding military conflict. GoFundMe has similar prohibitions on buying weapons.

Will crypto turn the tide of war? No.

  • President Biden moved last week to send $350 million in military aid to Ukraine. The EU followed up with $500 million in an unprecedented pledge of military assistance. And the White House is asking Congress for another $10 billion. The amounts flowing through crypto are a drop in the bucket.
  • And crypto’s high transaction costs are taking a bite out of what Ukraine’s receiving. Bitcoin transaction fees tripled in the past week. Gas fees on Ethereum, which traffics in a variety of tokens, have been more stable, but people have long complained about how expensive they are.

If we might make a modest suggestion for those who want to make a difference to the millions of Ukrainians in need of food, shelter and medical treatment, how about the Red Cross, which puts 90 cents of every dollar it receives to relief programs, an excellent ratio among nonprofits? Red Cross affiliates have called for $272 million to fund relief efforts in the country, where they’ve been operating since 2014. Oh, and if you absolutely insist, the Red Cross does take bitcoin.

— Owen Thomas (email | twitter)

A MESSAGE FROM MODERN TREASURY

Payment operations can drain time and energy from Finance, Product, and Engineering teams that would otherwise drive growth and deliver greater value to customers. Unsurprisingly, 86% of leaders are now prioritizing improvements to their payment operations. Download our report to learn the costliest payment-related challenges and how fast-moving companies are solving them.

Learn more

People are talking

U.K. leader Nadine Dorries wants Meta, Twitter and TikTok to ban RT and Sputnik:

  • “I want to urge you to do everything you can to apply the approach you are taking across the EU to block access both to RT and to Sputnik’s online output.”
  • RT America shut its doors and laid off most employees yesterday after worldwide backlash.

Yandex – Russia's answer to Google — is in league with the Russian government, said former head of news Lev Gershenzon:

  • "This is maybe the main pillar of the war. Tens of millions of Russian citizens don't know that the war is taking place."

Elizabeth Warren, Bernie Sanders, Richard Blumenthal and others want an investigation into Amazon's worker absence policies:

  • "We ask that you conduct this investigation expeditiously to ensure that workers at Amazon and other companies that maintain such cruel attendance policies are protected from abusive employers."

Rivian’s RJ Scaringe apologized for increasing prices for reservation holders:

  • “We broke your trust in Rivian.”

Making moves

Twitter wants someone to lead its Future of Work Innovation team. The position will “ensure we are aligned in our approach so that any employee can be successful at Twitter,” the job listing reads.

Marian Lee was promoted to CMO at Netflix. Lee had been the company’s VP of Marketing in the U.S. and Canada since last summer.

Cameron Cohen joined Square as general counsel. Cohen had been in-house counsel for Amazon for over a decade.

Yacine Azmi is the new head of Engineering at Nova Credit. He was previously a software engineering leader at Meta.

Sandy Knechtel is the new COO of Alaska Communications. Knechtel was previously an area manager for Alaska and Hawaii for Gartner.

Sony and Honda are working together on electric vehicles. They're setting up a separate joint venture, and plan to start selling cars in 2025.

In other news

Google suspended all ad sales in Russia. That includes on search results, YouTube and elsewhere. A number of companies have made a similar move, but nobody's bigger than Google in the ad world.

Ukraine dropped its airdrop plans, a project that encouraged more donations with crypto tokens. Instead, the country is looking into NFTs as a way to support the war effort.

Reddit banned links to Russian state-supported media outlets, following similar moves from Alphabet, Meta, TikTok and others.

Information labels don’t exactly stop the spread of misinformation, but they do lead to fewer user interactions, according to a study analyzing Donald Trump’s old tweets.

Twitter is reopening offices on March 15. Employees still will be able to decide where they want to work.

Verizon introduced +play, a subscription hub that manages other services like Netflix, Peloton and more. It first launched to a small group and will roll out to more people over time.

Netflix is launching another interactive series. This one is called “Trivia Quest,” and players move the story along in the game by answering questions correctly.

How to honor the National Day of Unplugging

It’s hard to step away from your devices when practically your entire life is on them. But maybe even just for an hour today, you can unplug. It’s the National Day of Unplugging, after all.

It’s not just a day, but also an awareness campaign that encourages people to get off their various devices. You can unplug for a cause, like taking time to declutter your pantry and donating those extra canned goods to a local food shelter, or find a place near you that’s participating in the day. How do you plan to spend your unplugged time today? Are you brave enough to extend it through the weekend? Let us know by replying to this email, and then get off your phone!

A MESSAGE FROM MODERN TREASURY

Scaling a company that moves money isn’t easy. Bad process, software, or luck can lead to costly errors, and worse, distract from your main priorities. Yet, many companies still struggle to build scalable payment infrastructure. Download our report to learn the main barriers companies face upgrading their payment operations.

Learn more

Thoughts, questions, tips? Send them to sourcecode@protocol.com, or our tips line, tips@protocol.com. Enjoy your day, see you Sunday.

Recent Issues