The United Nations High Commissioner for Refugees’ Stellar-based aid platform pilot seeks to use USDC stablecoins to make getting money to Ukrainian refugees faster and more secure.
The UN has turned to blockchain payments to distribute aid to Ukrainians who have had to flee their homes.
The Stellar Development Foundation (SDF) announced the launch on Dec. 15 of a pilot program with the United Nations High Commissioner for Refugees (UNHCR) to distribute digital cash payments to internally displaced persons (IDPs) and others affected by Russia’s invasion of the country.
The Stellar Aid Assist platform is being used to distribute funds in Circle’s USDC stablecoin, which can be redeemed for dollars, euros or Ukrainian hryvnia at 4,500 MoneyGram locations throughout the country. The USDC is loaded onto a Vibrant digital wallet that can be downloaded onto a smartphone.
The blockchain-based system allows “the delivery of cash assistance directly into the hands of those being assisted quickly, efficiently, and securely with full value transfer traceability and accountability,” the SDF said. “The money will provide humanitarian assistance to some of the people most impacted and vulnerable due to the war, to help them cover basic needs like rent of accommodation, food, medical care and heating during the winter.”
The pilot program will roll out in Kyiv, Lviv and Vinnytsia before expanding to other towns and cities.
"Today, we can see how blockchain technology allows us to scale humanitarian efforts in a way that wasn’t possible before,” said Deputy Minister of Digital Transformation of Ukraine on IT industry development Oleksandr Bornyakov. He added:
“For fleeing Ukrainians, and primarily for those whose banks are inaccessible, this pilot project providing humanitarian assistance using a digital wallet, will serve as a possible lifeline for survival.”
More broadly, the Stellar Aid Assist platform-based program “is a vivid example of how blockchain has the potential to transform and revolutionize the way humanitarian funds are allocated,” Bornyakov said, adding:
“The use of blockchain technology allows humanitarian organizations such as UNHCR to be more transparent and accountable and ensure that the most vulnerable people will have access to funds provided in their name. In this way, humanitarian efforts around the world will be strengthened in an unprecedented way.”
The Ukrainian government has embraced blockchain and cryptocurrency during the war, raising $184 million in crypto as of Nov. 30, according to blockchain analytics firm Crystal.
Quicker and Easier
This is not the first time the UN aid agencies have experimented with blockchain technology.
In 2017, the UN’s World Food Program (WFP) set up an Ethereum-based aid delivery program in the Zaatari refugee camp in Jordan, which housed 75,000 Syrian refugees. Using biometric eye scanners, the Building Blocks program linked to cash accounts that could be used in participating facilities like a supermarket just outside the camp.
The program was also an early in-the-field use of portable digital identification, another use many blockchain advocates see as a prime target for the technology.
Blockchain is one of the high-tech solutions the UNHCR has been experimenting with as part of its push to deliver assistance faster.
“Speed is of the essence in humanitarian action. It’s also essential to provide people with a range of options for receiving aid, as one size does not fit all. said Karolina Lindholm Billing, UNHCR Representative to Ukraine.
With the advent of its Cash-Based Interventions policy in 2016, the UNHCR began focusing on getting cash directly to refugees, which is preferred by both distributors and recipients. The UNHCR has delivered some $5 billion to 35 million people since then.
It is “essential to provide people with a range of options for receiving aid, as one size does not fit all,” said Karolina Lindholm Billing, UNHCR Representative to Ukraine.
Cash also provides a much wider choice of spending options than other forms of aid like food distribution, and allows refugees the ability to take it not only around their country but across borders.
“We are helping get funds into the hands of those who need them – and doing it quickly, transparently, and without the need for bank accounts or credit or debit cards. said Denelle Dixon, CEO and executive director.of the Stellar Development Foundation.
