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Ukrainian crypto and blockchain firms survive despite ongoing conflict

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Many Ukraine-based businesses have had to shutter or suspend operations following the outbreak of the conflict with Russia on Feb. 24, but some in the cryptocurrency space have been able to keep running, albeit with many staff in bomb shelters, scattered across the world and facing an uncertain future. 

Speaking to Cryptox, Arsenii Hurtavtsov, a Ukrainian national and CEO of nonfungible token service provider Finch, said he managed to get on one of the last flights from Kyiv to Azerbaijan on Feb. 23 before the country began blocking many men from leaving, likely in anticipation of needing individuals for the country’s military. He joined his business partner, chief operating officer Alina Varakuta, in Dubai shortly after his escape. 

Both heard from friends and family abroad and were concerned about their own safety, but also considered how they might continue running Finch and getting money to employees in need.

“We were shocked because we couldn’t continue to work because our guys were in bomb shelters — it’s crazy,” said Varakuta.

“After the war started, I contacted all our clients and said that we had to suspend our work for one week at least,” said Hurtavtsov. “Fortunately, all of them understood the situation and they agreed. After that, we tried to contact all of our employees. We said that we would give them as much time as they needed and that we would not fire anyone, because we understood that maybe for two weeks or many months, they will not be able to work at all but they still would need to buy food and other things.”

Finch CEO Arsenii Hurtavtsov and COO Alina Varakuta speaking from Dubai

The Finch CEO said that all 50 of his employees managed to find places to stay and were safe as of the end of March, having received their full salaries. Some who were eligible to leave Ukraine — mostly women — relocated to Hungary, Moldova and other European countries, leaving 35 behind. Hurtavtsov and Varakuta said they were able to shoulder much of the burden from Dubai as well as expand the team with additional specialists in Ukraine: 

“Despite the fact that there is the war in Ukraine, we’re still growing month over month and, at the moment, we also attracted our first round of investment.”

From an employee perspective

Maria Yarotska, an employee of blockchain company NEAR, told Cryptox she wasn’t able to leave Ukraine until March 2, a full week after the invasion, when Russian military forces were advancing on Kyiv and many other cities. As of the end of March, she was staying in temporary accommodations in Lisbon as some of her colleagues gathered, considering opening a branch office in the Portuguese capital city. 

Related: ‘I’ve never paid with crypto before’: How digital assets make a difference amid a war

Like employees at Finch, many men working with NEAR were forced to stay in Ukraine due to a decree issued by President Volodymyr Zelenskyy preventing men aged 18–60 from leaving. Yarotska, previously based in the port city of Odesa and having worked for NEAR since November 2021, assessed the situation for a few days before driving with her child and dog across Europe to Portugal. 

“I explicitly told my team that I will be six days on the road, and I would need someone to take care of my projects,” said Yarotska. “They agreed because the company is founded by a Ukrainian, but I work in a developer relations department and I’m the only Ukrainian in the department and, for that matter, the only woman. All of them just supported me, waited for me and made it happen.”

She added:

“When the world is falling apart, it’s good to rely on your company, at least.”

Looking to the future

While Varakuta said Finch planned to open an office in Miami, the company would continue to build its “main team” in Ukraine despite the uncertain situation with Russia.

“Ukrainian designers and Ukrainian developers are incredibly valuable in the world with their actually reasonable price,” said Hurtavtsov. “At the moment, we’re considering relocating some people from our team from Ukraine to the United States.”

The Finch CEO added that Ukraine-based companies dealing with crypto and blockchain as well as others still needed outside support to stay in business:

“A lot of companies and a lot of investment funds are worried and scared working with Ukrainians because of this situation and because they don’t want to pay a project to be interrupted by some unpredictable occasion. I would say that a lot of Ukrainians still need to work, as they need to help their families.”

While some of Russia’s military operations seemed to have been briefly scaled back, news outlets are reporting that the bombing of cities and outlying areas continues. Many in Ukraine are still facing a lack of infrastructure necessary to run a company, including stable internet connectivity, food and water supply, electricity and medical care. 

Across the border, Russia-based firms may face different issues but have nonetheless been affected by the conflict with Ukraine. Many private businesses based outside of Russia including Visa and Mastercard have scaled back or entirely shuttered operations within the country. Since the war started, crypto exchange Currency.com has announced it will no longer serve Russia-based users. Meanwhile, London-based crypto exchange Exmo suspended its business in Russia and Belarus, hinting the invasion of Ukraine made both countries a “high-risk market.”

Related: Every Bitcoin helps: Crypto-fueled relief aid for Ukraine

Despite the active conflict, the Ukrainian government has moved forward with legislation aimed at establishing a regulated crypto market, with Zelenskyy signing a law into effect on March 16. According to Aid for Ukraine, a crypto donation platform set up by the country’s Ministry of Digital Transformation “to support people in their fight for freedom,” users have sent more than $60 million to government wallet addresses as of the time of publication in Bitcoin (BTC), Ether (ETH), Tether (USDT), Polkadot (DOT), Solana (SOL), Dogecoin (DOGE), Monero (XMR), Icon (ICX) and Neo (NEO).