Amid the fog of war, Ukraine raised 8.1 billion hryvnia ($277 million) in a sale of war bonds on Tuesday yielding 11%, in the country's latest fundraising effort to tap into the global support for the country in its fight against Russia’s invasion.
As Bloomberg reports, the sale "encountered difficulties" that made it complicated for investors to buy, including a Ukraine finance ministry website which had cut off access from abroad to avoid cyber attacks. Furthermore, concerns over the settlement process for the bonds and the lack of information meant that some international bond funds remained on the sidelines.
On social media before Tuesday’s bond auction, users were asking the Twitter account of Ukraine’s finance ministry how to buy the bonds. Others pointed to alternative avenues for donations, such as the special central bank account.
Ahead of the emergency bond sale, Ukraine had been pursuing various crowdfunding initiatives, including collecting donations via bitcoin. Its central bank set up a special account last week where people around the world can donate, and the government shared details of crypto addresses to raise funds in Bitcoin and other digital tokens. By Tuesday morning, those accounts had received more than $17 million, according to blockchain analytics firm Elliptic. Including NGOs providing support to the military, total donations amount to $24.6 million, it said.
However, those hoping that the new funds will reach Ukraine's suffering people, or even its military, will be disappointed: the only "winners" from today's bond auction are other, existing creditors: shortly after the bond sale was completed, the country's debt chief Yuriy Butsa told Bloomberg TV that Ukraine has paid about $300 million of bond interest to international investors due today, in effect recycling the entire new bond issue to avoid default. The bonds, which carry a 7.75% coupon, were issued in 2015 as part of Ukraine’s $15 billion debt restructuring, not to be confused with the debt restructuring that will have to follow in a few months when the country has no choice but to default on external creditors.