Vitalik Butterin, SHIB and the Indian Crypto Exchanges — How the scam is unfolding

I wouldn’t say this was a co-ordinated scam, at least on Vitalik’s side I have no idea what his thinking was, whether he really thought that sending SHIBA INU ( $SHIB ) that was in his wallet as “burned” SHIB tokens as donation for liquidating it and then using the money for COVID relief in India was a good idea or he knew the consequences and still went ahead to do it.

Shib Token — from CoinMarketCap

Shiba Inu Token ( SHIB ), an ERC-20 token on the Ethereum network gained popularity just recently and its price shot up 20x in just days. SHIB’s developers “burned” the 50% of the total supply on Vitalik Butterin’s Wallet address

Now for some reason this is a common practice among ERC-20 token developers where they burn their tokens not on a 0x0..0dead address but Vitalik’s wallet address, which he has total control of.

Long story short, Vitalik used the SHIB on his wallet to send it to a private entity owing an Ethereum address with the label “India Covid Relief” (contract — https://etherscan.io/address/0x68a99f89e475a078645f4bac491360afe255dff1), now it is worth noting that they are a private entity as the real and official Covid relief fund of India does not take crypto assets as donations.

Basically Vitalik did what’s known as a rug pull — he liquidated or at least sent SHIB to someone who would liquidate the assets for fiat currency.

Butterin’s transactions sending Shiba Inu token—

https://etherscan.io/address/0x68a99f89e475a078645f4bac491360afe255dff1

He sent 1Bn worth of (at the current mkt price) Shiba Inu.

As long as the assets are not liquidated it has no real value, unless you can buy stuffs with it, and with SHIB you can’t.

The private entity who received the donation did not liquidate the assets immediately.

They waited. While they waited the Indian retail exchanges, mainly WazirX and CoinDCX both announced the listing of SHIB, out of the blue. No hype buildup.

You should check the replies out

Safemoon had been trending in India for past month but they did not list it yet however they were very quick to list SHIB.

Now let’s see how that worked for them. Following things happened

  1. Vitalik sent his SHIB meant to be never used as the SHIB dev considered it burned, out to the so called “India Covid Relief fund”
  2. The “Covid Relief-fund” will be liquidating the asset
  3. Price will go down drastically as the total amount of SHIB with them is 50% of the total supply, it will go down very bad once it is all liquidated.
  4. However, they waited while Indian exchanges quickly went ahead to list the SHIB token.

Many Indians woke up on 13th May seeing SHIBA INU coin trend on Twitter — a coin is trending, but for what reason, who is there to give them context — so people started looking for ways to buy it, many bought it the difficult way using Uniswap etc. But those who couldn’t saw the listing on CoinDCX and WazirX as an opportunity.

And this is where the scam happened.

The hype on Twitter was already created. Major Indian exchange listing meant people would storm in to buy it no matter what, and that is what the average-joe did — Bought SHIB at 5 cents on WazirX, a person posted screenshot of his order where he bought SHIB @ Rs. 3, worth 57,000 INR, which turned to 100 INR in matter of minutes.

However, this was a glitch, I am not saying this was the scam, the price might be a glitch that can be reverted by the exchange, but the scam actually happened with the listing of it. Now people in India are going to pour their money into SHIB, many without knowing there’s a wallet holding almost 50% of the total supply ready to dump it at any given time.

The buys that will happen on these exchanges will take Indian’s money, to be ultimately liquidated by the “Indian Covid Relief Fund” for fiat money — and be said to be donated by someone called Vitalik.

The “burned” SHIB was supposed to be considered burned by Vitalik. He never opposed the actions of these developers sending tokens to his address, he kept it, without saying a word, and then he takes this step — it tells a lot about his mentality and integrity.

On top of that Indian exchanges knowing the risk of SHIB and its potential to be rug pulled or dumped by a wallet holding 50.6 Trillion from the total supply is even dangerous.

If you were thinking of buying SHIB, don’t. If you really want to own it do it at your own risk, the exchanges are not liable for your decisions, they listed it, they knew it was not the right time for the people to put their money in, still they did.

Once the relief-fund wallet dumps the SHIB it has the prices will come down drastically and it might recover, or may not.

A web developer and designer. Likes to write and learn things that interests him.