India’s cryptocurrency community is chipping in to overcome an acute syringe shortage hindering the country’s Covid-19 vaccination drive. But supply chain disruptions and regulatory hurdles pose problems.
In August, the India Crypto Relief Fund, founded by a New Delhi-based entrepreneur Sandeep Nailwal, signed a deal with Unicef India to donate $15 million to procure 160 million syringes.
The instruments were to be delivered between September and January 2022. However, only about five million have reached India.
“We have already delivered the money to Unicef India. But the bigger problem is the logistics,” Nailwal told Quartz. “Because the syringes are required immediately, we have to airlift them. The shipping lines are taking two months for the consignment to arrive. Therefore, the freight costs are quite heavy.”
India Crypto Relief Fund has donated nearly half of the freight cost of about $5-7 million to Unicef India, Nailwal estimated.
Besides a global shortage of shipping containers, the complex process of converting virtual coins into rupees is time-consuming, according to Nailwal. This is particularly so because of a lack of a regulatory framework for cryptocurrency in the country.
Disbursals of crypto donations
The India Crypto Relief Fund, set up in April this year, aims to channelize money from across the world towards India’s Covid-19 battle.
Nailwal said it has disbursed $36.28 million out of the $429.59 million collected till now in 10 different cryptocurrencies. About $9 million more will be transferred next week, he said.
This included, among others, Ethereum co-founder Vitalik Buterin’s donation of 500 ethereums and over 50 trillion Shiba Inu coins in May. Together, this was valued at around $1 billion (7,550 crore rupees).
However, Buterin’s massive contribution of Shiba Inu coins—they are notoriously volatile—led to a 50% plunge in their prices. They eventually amounted to only $400 million, Nailwal had told Bloomberg in July.
Meanwhile, former Australian cricketer Bret Lee, too, donated a bitcoin worth around Rs45 lakh in April.
The relief fund offers aid to only organisations eligible to receive foreign contributions.
Regulatory hurdles in India
Cryptocurrency operations are not regulated in India yet. This prolongs the process of converting digital tokens into fiat currency—rupee—and funding NGOs in the country.
“We kept crypto operations completely outside of India. We set up an entity in Dubai that receives crypto money in USD and then we convert it into rupees…It takes about two weeks for the funds to reach India,” Nailwal said.
Cross-border payments, too, are a complex process.
While Nailwal’s relief fund is primarily targeting Covid-19 in India, it has also deployed funds to build the country’s health infrastructure, especially in underserved areas, and to back various research projects.