Crypto’s humanitarian sales pitch in Turkey and Syria

Hello and welcome to the latest edition of the FT’s Cryptofinance newsletter. This week we ask if crypto donations really make a difference in times of crisis.

After the devastating earthquake that struck Turkey and Syria earlier this week, the crypto industry has tried to do its part by rounding up millions of donated tokens.

Blockchain records show that wallet addresses shared by AHBAP, a local nonprofit, received more than $3 million in donations this week. Blockchain analysis firm Chainalysis estimates that more than $5 million in crypto donations have been sent to Turkey and Syria.

“Many people around the world want to help with cryptocurrency,” wrote AHBAP founder and local artist Haluk Levent on Twitter.

Chainalysis rival Elliptic has also tracked donation numbers, raising more than $10 million worth of crypto tokens.

In many ways, Turkey’s economic woes even before the earthquake hit means the country is primed to embrace crypto. An era of rising prices and falling interest rates is playing into the hands of crypto evangelists who claim digital assets like bitcoin are a store of wealth and a hedge against inflation.

“If you ask people, they are so eager for crypto,” an Ankara local named Tolga told me. The FT’s new Turkey correspondent – ​​and my old boss – Adam Samson spotted a coin shop in his first week in Ankara.

A coin shop in Ankara

A coin shop in Ankara spotted by FT Turkey correspondent Adam Samson © FT montage / Adam Samson

For an industry ravaged by scandal, presenting crypto as the tool of choice for financial relief in times of crisis is a great selling point. But is it true?

“You can’t use crypto in daily life,” Tolga explained, adding that locals need to convert their crypto to Turkish lira and withdraw newly converted fiat to their bank accounts. Hardly the kind of financial gymnastics needed after a natural disaster.

Another local — who I won’t name but who traded cryptocurrencies before the earthquake — has been struggling to free funds from a popular exchange since the disaster. “I’m really sad, I have nothing left to do but wait [the exchange to help]’ they told me via Twitter.

“Some of our friends are lying under the rubble . . . We can’t hold back our tears.”

The intent of crypto advocates may be admirable, but the simple fact is that where crypto succeeds in enabling near real-time transactions, it fails in real-world utility.

“If the goal is to get grandma’s money quickly and easily, there’s a strong economic argument that a countertrade swap through a cryptoasset isn’t going to be cheaper than traditional mechanisms,” the software engineer and cryptocurrency expert told me. Critic Stephen Diehl via text. “Ultimately, the recipient has little use for bitcoin because they can’t spend it.”

That’s not to say crypto can’t serve a humanitarian purpose. I would be remiss not to point that out More than $50 million worth of crypto tokens were donated to Ukraine’s war effort following last year’s massive invasion of Russia.

Weeks after the invasion, Ukraine’s Deputy Minister for Digital Transformation, Alex Bornyakov, said that crypto was “extremely helpful” when it came to it Shipping vital supplies to the armed forces. “Every helmet and vest purchased through crypto donations is currently saving Ukrainian lives,” he said.

That may be true, but before Christmas, Bornyakov also told me that Russian use of crypto to circumvent sanctions would become a “big problem.” So there are always two sides of the coin in cryptoland.

How do you assess the usefulness of crypto in times of crisis? Let me know

Weekly Highlights

  • Another week, another crypto platform bites the dust. LocalBitcoins, one of the oldest crypto exchanges in the world, has announced this discontinue his service after more than 10 years of activity. The company blamed the “continued very cold crypto winter” for its closure and apologized to users for “any inconvenience it caused.”

  • The bad news for crypto exchanges continues: Late Thursday, Kraken ended its staking program for US clients, paying $30 million in a settlement with the US Securities and Exchange Commission. The settlement is the latest in a series of enforcement actions against actors who the SEC says have violated securities rules. Check out my story with Stefania Palma here.

  • My colleague Joshua Oliver published a fascinating article in FT Magazine about the final hours of FTX, written during his recent trip to New York. Check it out here

  • Former Coinbase employee Ishan Wahi pleaded guilty on two counts of conspiracy to wire fraud. You may recall the 32-year-old’s case in July last year when the former product manager was tasked with sharing tips on tokens to be listed on Coinbase. “Wahi is the first insider to admit guilt in an insider trading case involving the cryptocurrency markets,” said US Attorney Damian Williams.

  • Days before taking action against Kraken, the SEC laid out its priorities for the coming year. Among other things, the regulator pointed to emerging technologies and crypto assets as one sector risks for investors or financial markets. This much is obvious to anyone who has been following crypto for more than a day, but if you thought the SEC was tough on this industry in 2022, my advice would be to buckle up.

Soundbite of the week: “Shameless” crypto founders

Arrows Capital’s three co-founders, Su Zhu and Kyle Davies, oversaw one of the most high-profile crypto meltdowns of 2022 that didn’t go by the name of FTX.

Earlier this year, both men announced a new exchange called the GTX. The idea behind GTX is to give impatient people a chance to trade bankruptcy claims before the slow wheels of justice settle the claims for themselves. No, I’m not joking.

The Three Arrows liquidators, who have long complained about the co-founders’ reluctance to enter the bankruptcy process, slammed Davies for his latest project.

“As of January 5, 2023, Mr Davies has been active on social media and has ‘tweeted’ or ‘retweeted’ dozens of times. . . Shamelessly while giving in to his obligations to his failed venture, Mr. Davies recently took action to raise tens of millions to launch a new crypto exchange.”

Data Mining: A Word on Darknet Market Share

If you follow the ever-evolving nexus of cryptocurrency and crime, you will recognize the Hydra market — at its peak, the largest dark web market in the world.

Earlier this year, the US Department of Justice cracked down on the founder of Bitzlato, a little-known crypto exchange that allegedly operated as a money laundering conduit. Its main trading counterpart, Hydra Market, shut down in April last year.

New data shared by Chainalysis shows that Hydra crushed the competition despite only having a third of the year to play.

Bar chart of top dark web markets and scam shops by revenue last year (US$ million) shows that Hydra Market eclipsed the dark web industry in 2022 despite the April shutdown

Cryptofinance is published by Philip Stafford. Please send any thoughts and feedback to

Your comments are welcome Crypto’s humanitarian sales pitch in Turkey and Syria

Adam Bradshaw

TheHitc is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – The content will be deleted within 24 hours.

Related Articles

Back to top button