🇮🇳 Crypto Relief Fund Update: Seeded by Vitalik Buterin's $1 Billion Crypto Donation

The largest crypto public health fund moving from relief to strategic funding and a rebrand.

Apr 06, 2023

Vitalik Buterin, Founder of Ethereum. *Image by John Phillips, Attribution 2.0 Generic (CC BY 2.0)*

In May 2021, Vitalik Buterin donated $1 billion worth SHIB coins to India's Crypto Relief Fund, propelling it to be one of the largest public health fund in India. The fund was set up to provide emergency supplies during India's severe COVID outbreak, and was founded by Sandeep Nailwal, Co-founder of Polygon, the popular Ethereum L2. Fundraising was conducted exclusively in cryptocurrency, with the global crypto community coming together to support India during the crisis.

This fundraiser was also my entry point into the world of crypto as I was curious to understand how this magic internet money can save lives, which it did. Through a series of articles, I documented this campaign in its early days.

Recently, I had the opportunity to catch up with Nagakarthik a core team member of Crypto Relief for an update on the fund's current status.

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The following is the edited version of the interview:

Deepa: What is the role of the relief fund now that the outbreak is over? Also, why did you never call yourself a DAO when you operated like one with a multisig, Discord, and global coordination?

Nagakarthik: You're right when you say that we operate like a DAO just because of how we are structured and how we came about it. What was different about us was that the scale of this wasn't planned. Usually, if anyone were to do something of this scale, there would be at least a few good years, if not a few good quarters of planning that goes into it.

We started off as a relief fund, and with the last donation from Vitalik Buterin, it catapulted us into one of the largest public health funders in India. That forced us to relook at how we think about the fund itself.

We could either continue doing relief work, or we could invest in something more permanent and long-term. Instead of a simple equation of "I give you something and something happens," we wanted to invest in setting up ecosystems and building up more long-term infrastructure.

After many discussions with volunteers and Sandeep, we took this direction. With a fairly large amount of money, we needed the right people to move this into a strategic fund. Initially, not all of us were from the social or public health sectors. While it allowed us to work efficiently for relief efforts, after a year, we decided to build more strategy, such as district-level health system strengthening.

What can this fund do that others cannot? For example, some larger funders in this space come with very well-designed, large-scale projects and offer them to NGOs or governments for partnerships. However, these programs weren't designed with the communities they were meant for, leading to pilots that never kick off. The funding ends, the project ends, and then the next person comes up with the same thing. We understand why many other funders do this. They may have corporate baggage or mandates from other countries if it's a multilateral or bilateral fund.

Deepa: I totally get your point because it's so funding-based, right? The funding ends, the project ends, and there is no bottom-up approach. Web 3 thinking is always about designing with the community. So I understand where you're coming from and how you're re-looking at things. So yeah, continue

Nagakarthik: So, it puts us in this quadrant where we can do bottom-up flexible funding, and we feel that's not a space that India enjoys right now. You either have CSR that says you are on your project-based funding. Very tight line items. Even if the project's failing, you have to manage the donor because you signed up for a certain line item.

We wanted to break away from all of that. And that's what I think we've been doing for the last year to actually set up teams and processes.

We now have three different verticals we want to work in.

1. One is to see how we could help build and support the whole bioinformatics and virology research space. So, pandemic preparedness helping existing institutions maybe upgrade or supporting research or doing really good work with translational research to actually bring these onto the field. So that's one vertical.

2. The second vertical is something that we're calling the district health stack. Essentially what we're saying is we need a learning layer of sorts in our districts to get deep into the community and learn what these problems actually are. And that is what is going to allow us to design contextual large-scale programs.

We cannot continue to look at something that worked in some other state or in some other country and now let's do it in India. We're a large enough and diverse country to actually, if you put people on the ground with a public health background, with a human-centered design background, they could really get very contextual and then we'd have relevant technologies and platforms.

And so the idea here is to pick about 15 districts and really do this with state-level government partnerships and allow for a lot of these designs to emerge rather than giving people something and saying, hey, please implement this for us.

3. The third piece we want to focus on, again, barring we have limitations with FCRA and sub-granting and all of that, but we want to see how we can still play a part in the innovation ecosystem. At this point, we're not structured to make equity or debt investments, but we still feel through some very strategic partnerships with partners in India, you could set up a very agile innovation ecosystem that allows for failures, allows people to go after a lot of the lesser-funded project areas, even things like long COVID or things like figuring out something for an Anganwadi worker, which don't necessarily see a lot of money. Either through hackathons or grand challenges and things like that. So that's the third piece.

We're also morphing into Blockchain for Impact. One is to signal that we're moving away from relief and moving into strategic work. Also, just the word crypto carries a lot of negative baggage, at least in India.

So we’ll be rebranding to Blockchain for Impact, where crypto relief will still be the brand name for any relief work that we do. It'll happen under that banner. But this new branding means that we now have a public health team. We now have a bioinformatics and specialized team that can understand this ecosystem and we are getting up to implement a bunch of these things in the next three years.

This also explains why we haven't gone ahead with relief and spent a good chunk of the money. We wanted to be really sure that we are able to do this more strategically. The requests for oxygen cylinders or paying for patients those kind of relief requests will never stop, and the pool of money that we have is really tiny if you look at the size of the country.

So, that's been our journey since the initial relief work was over. There has also been a change in many of the volunteers who signed up for it. They signed up as short-term volunteers and did not expect us to become a strategic fund. This was not the kind of work they wanted to do, or they had other priorities.

For example, like me, I run an NGO that works in the northeast of India and has been working in public health, entrepreneurship, and climate for a while. So now, the team is more specialized to carry out a bunch of the strategic work. That's where we are.

Deepa: So how are you structured now as a fund? Are there full-time people? If you can talk a little bit about the new team structure that would be great.

Nagakarthik: There are lots of full-time people part of the initiative right now. A couple of us core volunteers are still figuring out what our engagement will be, but it'll definitely turn out to be a full-time engagement. The reason I'm saying that is we still see ourselves as custodians of this fund.

The plan now is that since we're incorporated in Dubai, there will be a secretariat of sorts where a bunch of us can formally start working with the Dubai entity almost as a secretariat to plan the strategy of the fund and approvers for larger high level decisions

But a lot of the work of implementation on the ground will happen through strategic partnerships with FCRA approved NGOs in India. So we don't foresee ourselves getting into too much of implementation, except in some cases but rather play the role of actually designing programs with NGOs.

Programs are expected to be fairly large scale, span about three to five years, allow the kind of flexible funding, and then trust in the NGO or the partners in the social sector.

That being said, there are a bunch of full-time employees now in an NGO in India who also work along with us in the secretary. So it is a full-time team who is making this overall strategic plan for the fund.

Deepa: And would the grant-making process be application-based? How would you go about your due diligence? I know you want to design with the community, but I'm just thinking it aloud how would you source partners for this?

Nagakarthik: So for sourcing partners, we've worked with about 60 NGOs to date. And at the first go, at least for the first two or three years, it'll involve working with the majority of them. So the initial piece of engagement with those NGO partners was relief. Now the second piece is going to be strategy.

So the process differs. For something like the startup ecosystem-related, it'll be more of a scouting, RFP kind of mechanism. Whereas for the virology and the bioinformatic space, it's going to involve actually partnering with a lot of existing institutes. And then sourcing researchers and research work from there.

So that might not really be an application-based process because these institutes already have these people who, some of them are doing really good work, and then we are able to step in and just accelerate or provide them with a little bit of support.

In the district piece, we are actually looking at a government partnership. We are speaking with state governments and NGOs who have worked in some of the rural districts. We are assessing every conversation and asking ourselves, “where are we getting government support? Where are these NGOs doing good work on the ground, and how can we actually pull this off?”

Deepa: That sounds great. You mentioned that crypto comes with a lot of baggage, and I too refrain from using crypto many times. I've started saying DAOs and I get more respect from my peers, who are all social entrepreneurs. Initially, I said crypto and they were like, “oh, what are you doing in this space?” But I feel like DAO and Web3 is a better way to approach the subject. Then I bring the conversation back to crypto to explain how that fits in.

What do you think are the challenges in terms of just being in the media or just portraying crypto relief fund to the public?

Nagakarthik: We didn't sign up for the fanfare, to be honest. It's something that we’ve had to accept with the amount of media frenzy or the questions. Because of the stance we took early on about transparency and about just communicating a lot of what we were doing, we feel it worked in our favor. Also, now there is work happening on announcing this change in strategy. So, on the pieces of transparency, we are in the middle of setting up a decision-making or a voting process, which will be made publicly available.

We are trying to figure out how our audits can be made publicly available. So I think the essence of the fund, even though it's moving from relief, which is faster and easier, to more complex processes, the essence of transparency and accountability, we still want to hold onto. And that also becomes a differentiator for us.

So, whether it is why or how a partner was selected or why these three verticals, there has been enough deliberation and a lot of this has been captured. We've spoken to people who are from the field, who are either from, in some way from the public health community and they've been able to give us input. A lot of these things have been created, not only within the team but with a lot of conversations and deliberations.

Deepa: I feel like you have a way to show India how things can be done differently using decentralized technology. Recently, I attended philanthropy awards night in Mumbai organized by Mumbai Marathon. 50,000 people ran, and raised $5 million on a single day, and it all goes through United Way Mumbai. The partnership that I had helped establish. We positioned United Way to be the official philanthropy, through which the money will be routed. But now, I feel it's so centralized, with one entity being the pass-through and controller.

What are some of the newer or web3 ways that you’d be applying.

Nagakarthik: So regarding the use of blockchain technology, our current thought process is that it forms a smaller vertical within the innovation piece. In the context of public health in India, we feel that a lot of web3 technologies, Dapps, and the vibrant ecosystem we have in the country, we can play a role in connecting problems on the ground to people who can build solutions and incentivize those pieces. That's something we are clear about in terms of how blockchain or Web3 would be involved in our work.

We are committed to having separate grand challenges and focused hackathons, where we can put out problem statements, get people to build solutions, incentivize prize money, and allow evidence in case studies on the ground. That's one piece.

Regarding governance, we are exploring certain voting mechanisms to ensure transparency, but the challenge is that as we move to the strategic piece, we are also setting up teams of board advisors. It's only possible when you have a trusted team that is committed for the long term.

We tried doing DAO when we were in the relief stage, but because the roles weren't defined, and the volunteers weren't doing this full time, a lot of people who were moving in and out disrupted the process. But if you have a solid set of people, then it's easier to exercise the mechanism. That's what we're thinking about right now.

Deepa: That makes sense. So are the funds still held in a multi-sig?

Nagakarthik: Most of the funds are in a multi-sig. We have a total of 272 that’s left, out of which about 40 million is in our digital bank account, and the rest is still in the multi-sig.

Deepa: Thanks for sharing your future direction. If people need to reach out or NGOs, where should they connect? Is Discord the primary channel?

Nagakarthik: No, we're shifting to email because it's more formal and easier to check. Once this whole rebranding piece is done in about a month, we'll have very formal channels of how people could reach out, depending on who they are.

That being said, with existing NGOs, our conversations are ongoing to see how, out of the 60, we can select a few with whom we can design the strategic pieces. As of now, we are not having any new conversations until this whole rebrand, and then the more formal way of engaging happens.

Also, what we experienced with Discord was a huge influx, and that was one of the early challenges. Pretty much everybody tried to chat, whether it was state governments or NGOs, and there was no way we could have an effective filter mechanism.

For newer organizations, it'll be via email. Then they need to align with some of these three verticals and strategic pieces that are there. But like I said, the strategic pieces are not too detailed, so it allows for conversation and somebody to talk about their work. That's the mechanism we want to follow.