Is this a good move by national bank of Ukraine - page 3.

_act_

legendary

Activity: 1064

Merit: 1298

Lightning network is good with small amount of BTC

Quote from: stompix on April 22, 2022, 08:53:18 AM

Pretty simple, it's about controlling the currency.
If some Ukrainians already have $ them buying bitcoin will not affect the hryvnia parity at all, that is something happening outside, if, on the other hand, they buy BTC or any other thing with hryvnias that will make the currency drop, by restricting this you try to limit the damage.
Russia has gone overboard with control not allowing citizens to purchase foreign currency at all despite not being ravaged by war, and it does make sense temporarily but in the long term both a ban and a restriction will prove to be worthless, it will just make the fall harder.

I will agree with you, I noticed Russia did it and in few days or weeks later, the Russian rubles increased in price. But I am still just confused, what I thought before is that a country like to protect its foreign reserves, if the people in a country are demanding more of the foreign reserve, the central bank will not have option than to decrease the price of the local currency so to protect the foreign reserve depletion, which means that would still result to inflation or devaluation of local currency. If foreign reserves are used by Ukrainians, this could result to the depletion of foreign reserves in Ukraine.

I was later thinking Ukraine received donations in bitcoin, altcoins, US dollars, Euro, Pounds and other foreign currencies, probably could also be one of the reasons or the main reason that NBU restricted hryvnia to be used to buy cryptocurrencies because they have a lot of foreign reserve as a result of donation. I do not include bitcoin and altcoins as foreign reserve, though you know that.

Moneyprism

member

Activity: 454

Merit: 10

maybe they are doing this to protect their currency,,, because at this time their financial condition is very chaotic coupled with global inflation ... so it's only natural that the central bank of Ukraine issued a regulation like this

stompix

legendary

Activity: 2912

Merit: 6403

Blackjack.fun

Quote from: _act_ on April 22, 2022, 07:39:21 AM

NBU restrict Hryvnia to be used to purchase bitcoin a d altcoins but allowed foreign currencies to be used. I still do not understand the reason behind this because also foreign currencies have much to contribute to inflation if its reserves are depleting.

Pretty simple, it's about controlling the currency.
If some Ukrainians already have $ them buying bitcoin will not affect the hryvnia parity at all, that is something happening outside, if, on the other hand, they buy BTC or any other thing with hryvnias that will make the currency drop, by restricting this you try to limit the damage.
Russia has gone overboard with control not allowing citizens to purchase foreign currency at all despite not being ravaged by war, and it does make sense temporarily but in the long term both a ban and a restriction will prove to be worthless, it will just make the fall harder.

That's why I've always said a country in an economic crisis will never embrace BTC, it's like you suddenly import hard currency for your useless paper, exactly why the whole Weimar Republic case is still studied, imagine doing that not to pay some debt but to completely replace your monetary mass, it's suicide.

fiulpro

hero member

Activity: 1890

Merit: 831

The price of UAH is going extremely up and down making the whole thing super volatile therefore The bank is trying to ban these things to prevent the engagement of people to keep the investments in the banks, but I do not think it's a good move as well since :
1. People have very limited option right now thus they need to invest in something which can provide them with profits and using third party sites might not be a good option since they are not just : expensive but also there is a matter of trust around them as well.
They also suspended e-cash transactions https://www.google.com/amp/s/www.cnbc.com/amp/2022/02/24/ukranian-bank-suspends-e-cash-transfers-bolstering-crypto-use-case.html
The move seems to be a good one for the government but undeniably its causing difficulties to the people around since cryptos are a big deal in Ukraine and people are very actively involved in buying/selling.

crwth

copper member

Activity: 2940

Merit: 1280

https://linktr.ee/crwthopia

Having a monthly capping and not using their currency means that they probably want to strengthen the power of their money. So they don't care how much of a volume that Bitcoin with the buy and sell takes place, it's all about what currency they are trading with. Maybe their value of money has diverted into something that this is one of the solutions that they could think of.

jackg

copper member

Activity: 2856

Merit: 3071

https://bit.ly/387FXHi lightning theory

I'd imagine this is part of a much bigger plan by Ukraine to try to prevent another party from destroying the value of their currency (at all of further).

I think it's well known that a lot of wars have used a strategy of counterfeiting currencies to try to weaken your enemy's buying power.

There's also the chance pumps and dumps could occur on the currency to try to make it's value unstable and this could've been a way to protect against that - I think a lot of Ukraine's industry is less developed though so this will probably have less of an effect on them.

It might also be a good strategy for getting citizens to value their native currency as it'll be much easier to rebuild their economy if they still have a currency they themselves can control (to set things like inflation).

_act_

legendary

Activity: 1064

Merit: 1298

Lightning network is good with small amount of BTC

Ukraine bans Bitcoin purchases with local currency amid martial law

Quote

Ukrainians are now allowed to buy Bitcoin only with foreign currency with a monthly cap of $3,300.

The National Bank of Ukraine (NBU) continues taking measures to prevent capital outflows amid martial law by enforcing major restrictions on cryptocurrency purchases.

The Ukrainian central bank officially announced Thursday a set of restrictions on cross-border operations, prohibiting individuals from buying cryptocurrencies like Bitcoin (BTC) with the national fiat currency, the hryvnia (UAH).

I do not check the value of hryvnia but I think the war in Ukraine would have caused persistence rise in price of goods and services in Ukraine, which means inflation. NBU restrict Hryvnia to be used to purchase bitcoin a d altcoins but allowed foreign currencies to be used. I still do not understand the reason behind this because also foreign currencies have much to contribute to inflation if its reserves are depleting.

What could be the benefit of the NBC move to allow Ukrainians to only use foreign currencies to purchase cryptocurrencies and not allowing their own local currency to be used? But I think with this, only few people will have access to foreign currencies compared to those that will have access to local currency, which means a way to reduce Ukrainians that are buying cryptocurrencies.

Topic: Is this a good move by national bank of Ukraine - page 3. (Read 379 times)