Journalist uncovers wild story about Vitalik Buterin’s $1 billion crypto donation to Indian Covid Relief Fund

by Arthur · February 23, 2023

Journalist uncovers wild story about Vitalik Buterin’s billion crypto donation to Indian Covid Relief Fund

Back in 2021, in the midst of the best of the bull run and the worst of the Covid-19 pandemic, Vitalik Buterin made a now-legendary donation of $1 billion in SHIB to support the Covid-19 efforts in India.

Now almost two years later, an investigation by top crypto journalist Isabel Hunter (DL News) has revealed that only as little as 5% of the initial donation went to the Covid relief effort in India.

Ethereum founder donated $1 billion in SHIB tokens to an Indian Covid Relief Fund (called Crypto Relief) set up by Polygon founder Sandeep Nailwal.

Nailwal established the fund as Covid-19 saw a massive outbreak in the world’s largest democracy, with up to 3 million new cases reported daily.

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Buterin donation broke SHIB liquidity

Of the original $1 billion donated – Vitalik sent 500 ETH and over 1 trillion Shiba Inu (SHIB) tokens.

But while Crypto Relief quickly stepped in to monetize the impressive donation – the sheer size of the stack pushed SHIB to the limits of its liquidity.

In an OTC deal with WishfulCynic and WinterMute, Crypto Relief was able to trade the nearly billion dollar stack of SHIB for just $500 million in stablecoins (predominantly USDC).

This raises huge questions about the practical liquidity behind insane multi-billion market caps – with such low liquidity levels a worrying sign for the industry.

How was the US$500 million spent?

Of the $500 million received in stablecoins, $274 million remains in the Crypto Relief wallet.

The Crypto Relief Fund returned $100 million to Vitalik’s Balvi Fund – which was created shortly after to fund bold projects that offer innovative responses to the pandemic.

$100 million was apparently reduced between April 2021 and April 2022 – and surprisingly, Alameda Research handled up to $1.5 million of those funds.

From this disbursement, only $58 million reached registered non-profits and NGOs in India – with 57 of the 60 projects declared by Crypto Relief funds confirming that they received the donation share.

Yet a bank statement recently shared by Nailwal showed that $40 million of this funding was in a bank account in Puerto Rico (with US-licensed FV Bank).

Overall, this means that only 5.8% of Vitalik’s original $1 billion SHIB donation was ever received in India.

And two years later, over $314 million (31%) of the donation balances were sitting in crypto wallets and bank accounts controlled by Nailwal.