Ukraine National Bank Places New Restrictions and Resolutions on Thursday

The Ukrainian National Bank (UNB) recently adopted a resolution following Russian attacks and the declaration of martial law within the country.  

Adopted Resolutions  

The resolution asserts that bank branches should continue normal operations unless life-threatening situations arise, or the health of the general population is at risk.  

The resolution also provided clarity on cash, non-cash payments, and support from the National Bank, which are as follows:  

• all ATMs should be supported with cash; 
• non-cash payments will continue to be accepted; and, 
• National Bank of Ukraine to continue to provide cash-related support.   

Banks will also be required to allow access to customers’ safe deposit boxes, and payments owed to the Ukraine Government shall continue, without interruption.  

Interim Restrictions  

Along with providing coherence on continued operations, the UNB also set forth several temporary restrictions to follow.  

These included temporarily shutting down the Ukraine foreign exchange market and adjusting the official exchange rate. Cash withdrawals will now be limited to UAH 100,000/day (with some exceptions including salaries and certain benefits). The use of foreign legal tender will be temporarily banned as well.  

In addition, banks will be restricted from issuing, restoring, or dispensing electronic money for the time being; they will also be barred from carrying out expenditure operations for accounts of residents located in Russia.  

Purpose

These new restrictions were rolled out in efforts to maintain stability within the Ukrainian financial sector and to continue normal operations within the country’s censorious infrastructure.

As Russian troops continue to advance into the country, bitcoin as well as several digital assets are seeing increasing volume. Cryptocurrency exchanges in Ukraine have noted a significant uptick in demand for stablecoins. This may signify a significant shift in trust as more users find cryptocurrency to be more reliable than the national bank.