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Shiba Inu saga comes to an end! Vitalik donates large amounts of dog-themed tokens - unhappy with Ethereum fueling speculation?

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Shiba Inu saga comes to an end! Vitalik donates large amounts of dog-themed tokens - unhappy with Ethereum fueling speculation?

Following the unauthorized transfer of a large donation from the Shiba Inu series of tokens to the address of Ethereum founder Vitalik Buterin, the recent chaos in the cryptocurrency market involving Shiba Inu may come to a temporary halt.

Why Does Vitalik Buterin Have Coins in His Address?

Shiba Inu SHIB, a meme token, was launched in August 2020. 50% of the total token supply was allocated to Uniswap for liquidity, while the other 50% was sent to Vitalik's publicly disclosed address.

The team behind Shiba Inu claims to have burned the private keys to the address, rendering it unusable. Sending tokens to Vitalik was seen as a mechanism to effectively burn the tokens. The team did not hold any tokens, viewing this as a fair distribution method rather than selling them to the community.

This practice by the Shiba Inu team has been emulated by subsequent dog-themed projects such as Akita Inu AKITA and Dogelon Mars ELON.

Vitalik's Actions of Selling and Donating Dog-Themed Tokens

Following the surge in Shiba Inu's value, there was increasing scrutiny on Vitalik holding a significant amount of dog-themed tokens. Vitalik had not responded to these concerns until the early hours of May 13, when he took the following actions:

  • Sent 500 ETH and 50 trillion Shiba Inu tokens, valued at over $1 billion before the deadline, to the India Covid Relief Fund
  • Donated 49 trillion Akita Inu tokens, valued at over $432 million before the deadline, to Gitcoin
  • Donated 432 trillion Dogelon ELON tokens, valued at over $277 million before the deadline, to the Muskoka Wildlife Centre
  • Donated 13,292 ETH, valued at over $52 million before the deadline, to GiveWell

Despite the remarkable nominal value of the donations, the liquidity of these dog-themed tokens is low. Selling them all at once would result in significant price discrepancies, with the actual proceeds likely differing from the nominal values. Following these events, the prices of the dog-themed tokens experienced the following fluctuations:

  • DOGE: -11.55%
  • Shiba Inu: -24.91%
  • Akita Inu: -42.83%
  • Dogelon ELON: -70.59%

What's Next for Vitalik?

Larry Cermak, research director at a foreign media outlet, pointed out on Twitter that Vitalik has put investors of these meme tokens in a dilemma and expressed that he would not be surprised if Vitalik faces legal action as a result.

Larry was puzzled as to why Vitalik chose to use a well-known public address instead of transferring the tokens to an unrelated new address. Was this a deliberate public statement?

Larry believes that Vitalik will soon explain his reasoning and the destination of the funds. He speculated:

My guess is that due to the congestion caused by the dog-themed tokens on the Ethereum network, gas fees have consistently been above 400. It costs over 300 gas to swap on Uniswap, rendering these tokens virtually useless, clogging up the Ethereum network, indirectly fueling these junk activities.