The war in Ukraine is not over yet, and cryptocurrencies continue to help people harmed during the conflict. According to an announcement by the Stellar Development Foundation (SDF), the organization will work to provide humanitarian aid to Ukrainians. This aid will involve partnering with the United Nations High Commissioner for Refugees (UNHCR) to test a digital cash disbursement system. This system, developed by Stellar (XLM), will make it easier to send aid to war-affected Ukrainians. UNHCR is the United Nations agency tasked with protecting refugees and those displaced by persecution or political conflict. In this sense, the agency helps Ukrainians who have had to flee the country since the beginning of the war in February.
Pilot project in action
According to the official announcement, UNHCR will be responsible for disbursing resources for humanitarian aid. Stellar, for its part, will focus on providing this money in an instant and decentralized way, through the “Stellar Aid Assist” project. For this, Stellar had other important partners in the transfer market. These include USDC stablecoin issuer Circle and giant MoneyGram. Another partner is the Vibrant wallet application, which will act as a means of receiving the funds. According to the project’s website, Stellar Aid Assist is already being used “to provide eligible Ukrainians” with financial assistance. That is, anyone who knows how to use a smartphone can now receive funds in USDC directly through their device. “Eligible Ukrainians can register with a participating relief organization to receive digital assistance help through the Vibrant wallet and get the funds in cash at participating MoneyGram locations,” the website says.
Stellar Aid and the pro-Ukraine UN
Thanks to Stellar and Vibrant, the UN can send money faster and cheaper than traditional channels. Fees through traditional means, for example, can cost up to 30% more than through stablecoins. When it comes to humanitarian aid, this difference is very relevant. The amount can mean the difference between a daily meal or the purchase of groceries. In addition, the Ukrainian banking infrastructure suffered from the war, including restrictions and limits on withdrawals. As a result, many citizens of the country were unable to use banks or did not want to depend on them. And a solution that dispenses with the banking system is very important in this context. These digitally delivered cash donations are intended to provide an alternative to handling fiat money at a time of great risk for storing or moving money. Finally, as for MoneyGram, the company allows Ukrainian citizens to be able to receive its assistance with effect, “even if (they) do not have a bank account or a credit or debit card”. Another function of the company is to exchange USDC for dollars or other fiat currency, which will be available to all Ukrainians.
Helps 33 people in December
As the war drags on and is about to complete a year, the need for humanitarian aid is present. In that regard, Stellar and the International Rescue Committee (IRC) have helped 33 of the 100 people they hope to reach before the end of the year. This number seems low, but it was the total number of people the organizations helped in December alone. IRC is an NGO created to help people persecuted for political, religious or ethnic reasons. One of the advantages of using Stellar Aid Assist to send money to people in need is the use of blockchain to track the process. In this way, Stellar prevents any theft or embezzlement of funds, identifying any possibility of fraud. Therefore, the solution offers greater transparency on the use of funds by all donors. At the same time, it offers refugees the security that they will be able to count on the money. Karolina Lindholm Billing, UNHCR’s representative in Ukraine, said she was delighted that both organizations had chosen Ukraine to test Stellar Aid Assist “so that it can benefit the many thousands of people who are in need of assistance as a result of the war”.