Can $1 Bn Worth Of 'Meme Coin' Be of Help to COVID-Ravaged India?
This aid comes amid India recording an average of 3,80,000 confirmed COVID-19 cases and over 4,000 deaths weekly.
Ethereum cofounder Vitalik Buterin has donated huge amounts of cryptocurrencies – Ethereum and Shiba Inu – worth $1.5 billion to help India tackle the ongoing second wave of COVID-19, as medical supplies such as oxygen and Remdesivir remain short in supply across the country.
The aid comes amid India recording an average of 3,80,000 confirmed COVID-19 cases and over 4,000 deaths weekly.
Buterin on Wednesday, 12 May, transferred 500 Ethereum (ETH), and 50 trillion Shiba Inu (SHIB) – a meme coin named after a dog breed.
India's crypto relief fund launched by Polygon cofounder and COO Sandeep Nailwal last month with the aim of helping the country combat the raging second wave of COVID-19, claims to have collected as much as Rs 22 crore in cryptocurrencies within three days of its launch.
What is SHIB?
The Shiba Inu coin, was launched less than a year ago and is named after a dog breed. This crypto asset calls itself as the 'Dogecoin killer'.
A single SHIB coin is nearly worthless – less than $0.000029 as of Wednesday. However, its trading surged this week after it was added to cryptocurrency trading platforms WazirX and Binance.
"We were receiving a lot of requests from our community to bring SHIB on WazirX, and hence, we decided to list it," CEO Nischal Shetty, WazirX told CoinDesk.
According to a report by Fortune magazine, Chinese traders have helped propel SHIB’s rise, as they handled the largest share of SHIB’s trading volume in recent days.
'Real Amount Much Lower'
Several questions remain about how much of Buterin's donation can be converted into fiat currency to buy lifesaving COVID-19 supplies like oxygen and how soon the funds will be deployed.
CEO of Crypto. com Kris Marszalek told Fortune magazine that 50 trillion SHIB and 500 ETH donated is worth over $1 billion combined. However, the “real dollar amount is likely much lower when the coins are liquidated," says Marszalek.
Sathvik V, Founder of Unocoin cryptoexchange told The Quint that this donation will be converted into liquid assets periodically. "This process might take several months as this move was unexpected so it will be difficult for exchanges to convert these into fiat currency. But this funds will definitely help India tackle COVID crisis," he said.
Sathvik suggested another way to convert these funds into physical currency. "The donation has to be converted into other forms of cryptocurrencies, but this process will decrease the face value of the fund," he said.
The Crypto Covid Relief Fund states that it has previously converted over $1.2 million from crypto tokens into COVID-19 relief donations.
According to its website, cash donations have been made to United Way of Bengaluru for oxygen concentrators and to Refrigeration and Oxygen Co. for oxygen cylinders.
Meanwhile, Punit Agarwal, a member of the Covid Crypto Relief Fund, tweeted: “We’re working on finding ways on how we can utilise the funds without harming retail investors of $SHIB."
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