Vitalik Buterin's $1 billion COVID-19 donation: Fact or farce?
On May 12, the 27-year-old founder of Ethereum Vitalik Buterin donated cryptocurrency worth $1.5 billion to COVID-19 relief efforts in India and several other non-profits. Buterin became the world's youngest known crypto billionaire just last week when Ether's value crossed the $3,000 mark, making his Ether holdings alone add up to just over $1 billion. Here's how he donated to India's COVID-19 relief.
Vitalik Buterin's memecoin holdings shot up in value with Dogecoin
Besides holding significant amounts of Ether, Buterin also owned enormous quantities of Shiba Inu coin, Dogelon Mars, and Akita Inu. All three cryptocurrencies are based on the legendary Doge meme and their value has skyrocketed hot on the heels of Dogecoin, the original memecoin. Crypto relief for India started when Polygon founder Sandeep Nailwal proactively launched a crypto-based COVID-19 relief campaign—India COVID-Crypto Relief Fund.
Coinbase CTO pledged $50 per retweet of crypto donation appeal
Nailwal's move also prompted Coinbase CTO Balaji Srinivasan to donate $50,000 in Ether. Vitalik Buterin followed with a 100 Ether transfer worth $600,000. Srinivasan also pledged $50 per retweet of his appeal up to $100,000. Buterin then transferred another 400 Ether and 50 trillion Shiba Inu coins then worth $1.2 billion to Nailwal's campaign.
Nailwal reassured investors that Shiba Inu community won't be hurt
Interestingly, Shiba Inu coin's anonymous creators gifted Buterin half the total coins to ever be produced, provided he never sold them. After Buterin donated to Nailwal, Shiba Inu's value plummeted 40% amid fears Buterin was liquidating assets. Nailwal thanked Buterin on Twitter and assuring Shiba Inu investors, he wrote: "We will not do anything which hurts any community specially the retail community involved (sic)."
Ethereum founder also donated to many other nonprofit organizations
Besides donating to Nailwal, Forbes reported that Buterin sent around $441 million of Akita Inu to Gitcoin, a platform based on the Ethereum blockchain. Additionally, Buterin donated 13,292 Ether to GiveWell, all Dogelon Mars tokens and 1,000 Ether to Methuselah Foundation, 500 Ether to the Charter Cities Institute, and 1,050 Ether to Machine Intelligence Research Institute.
A glimpse at what recipients of Vitalik Buterin's generosity do
GiveWell is a nonprofit charity evaluator while the Methuselah Foundation reportedly backs efforts in tissue engineering and regenerative medicine therapies. Machine Intelligence Research Institute reportedly works to make Artificial Intelligence technology safer and Charter Cities Institute is a public policy research organization.
Value of memecoins plunged just 24 hours after Buterin's donation
A day after Buterin's donations, Coinbase recorded that Shiba Inu fell 40%, Dogelon Mars plummeted 65%, and Akita Inu lost over 50% of its value. This means that the recipients received much less than Buterin intended to transfer. Further, Nailwal's assurance to Shiba Inu investors means he won't be able to dispense tangible COVID-19 aid as rapidly as it is required.
Indian fintech firm Cred mobilized its virtual currency more effectively
Ironically, even Indian fintech startup Cred successfully encouraged users to part with Cred coins earned by timely payment of credit card bills. The company then supplied 1,000 liters of medical oxygen per 10,000 coins donated. This was nevertheless the butt of jokes on social media.
Buterin's generosity dissolved by volatility, reduced value of recipients' crypto
Meanwhile, India continues to grapple with a shortage of hospital beds and medical oxygen amid a humanitarian crisis. When COVID-19 relief is needed, donations in the form of tangible goods that can immediately be mobilized are immeasurably more valuable than donations of nearly unusable virtual assets tied to market volatility. Nevertheless, we appreciate the gesture and understand that Buterin cannot control the markets.