Wednesday, 6 October 2021

What comes after the perfect score?

Ed Set Go by The Ken
The one-stop for the biggest shifts in India's $180 billion education market. Served hot and weekly, Thursdays.
Good Morning Jigar,
 

I'm Olina and for the last three years, I've written over 80 stories for The Ken on edtech, education, careers, and lifelong learning. If you're a regular reader of The Ken, you may recognise my work chronicling the biggest changes and events in India's edtech sector—whether that's an impending loan crisis at one of India's biggest education companies, or the public silencing of critics by some of India's most prominent edtechs. 

 

Trust me, there's never a dull day in education. Especially not since the pandemic lit a fire under the sector and forced changes that would've taken years, if not decades, to materialise. Big edtechs are now giant, lumbering predators, who casually spend US$2 billion to acquire other startups. Schools are struggling to stay financially viable and the government is on an overdrive to create digital public goods in education. Nothing will go back to "normal" again. 

 

But it's also a time for heady euphoria. There have never been more education companies turning into unicorns. And for the first time ever, Indian education companies are setting a global agenda with their money and influence. China's crackdown on its education businesses is a handy plot device.

 

But talking about education isn't just counting the VC dollars that flow into businesses. Talking about education, now, is to write at the intersection of business, technology, and policy that shapes and defines who gets to learn what. 

 

And that's why The Ken is adding a brand-new product in the mix. A weekly newsletter called Ed Set Go, helmed by me. Week on week, I will bring you my insights on what I think is at the cutting edge in the education sector. I will try and decode, ahead of time, where the winds are shifting to and why. 

 

This is also just one of seven new newsletters that we are launching this week. If you haven't done so already, I highly recommend you check them out here. And do keep an eye out for another brand-new newsletter tomorrow morning! 

 
What comes after the perfect score?
 

This week, Delhi University, a sought-after, multicultural melting pot of disciplines and students, announced its dreaded admissions cut-off list. For a record 11 subjects, top-tier DU colleges have asked for a substantial pound of flesh from aspiring applications: a perfect 100% in their board examinations.

 

This isn’t the first year that colleges have applied the 100% admission criteria. It's the third since 2011, but never before has it been at this scale. 90 programmes this year have asked for a 99% cut-off score. (A cut-off is the minimum amount of marks you need to qualify for a programme.)

 

This should technically be a disaster for students. They should be out on the streets, tearing this admissions process to shreds. A 100% score should be an anomaly and not the norm.

 

Right? Right?

 

Not exactly. Not when cut-offs are actually only a reflection of what students, on average, scored in their school graduating exams. And for the last few years, these scores have rapidly moved north. A phenomenon I’d like to coin as “marksflation”.

 

This excerpt from a report in the Times of India, paints a succinct picture:

If you go by marks awarded, Indian students have turned in their best ever performance in a year they seldom went to school and never took the final exam.
 
CBSE Class X and XII boards have passed a record 99.04% and 99.37% students respectively, with those scoring above 95% jumping 38% and 81%. This extraordinary uptick is echoed across state boards. For example, Maharashtra HSC results have witnessed a gravity-defying 1,000% rise in the 90% category.
The 95% problem: School results show grade inflation epidemic. College entrance process must adapt, The Times of India

The cartoonish 1,000% rise in the 90% category is celebratory—but only within the student’s post-exam bubble. It’s mostly terrible for actual admission to a place like DU. There’s a simple demand and supply push-and-pull at work here.

 

There is an over-supply of grades and an under-supply of seats, especially when in certain fateful years like 2019, students with a 95% score went from 17,000 in the previous year to 38,000. Colleges are already bursting at their seams, even if they have tried to allocate more seats every year for certain popular courses. If a central university has to add seats via porta-cabins and partition existing classrooms to fit in students, something has gone terribly wrong with marksflation. There was even a 10% increase in seats during the pandemic year 2020, when all classes went online. So colleges actually have no real time experience on how they’re going to fit in the extra students.

 

In 2021, DU has 70,000 seats on offer for which more than 400,000 students have applied. 70,004 students have scored above 95% in one central board alone, but it’s still not good enough to get them into college.

 

How did it come to this?

 

The clash of two broken systems…

 

…makes a deafening noise.

 

System 1 deals with everything that happens before the admission process. This system is controlled by school boards like the CBSE, the ICSC, and other state government boards, who score exams given by grade 12 students across India. Taking board exams, as anyone who’s been through this system knows, is grueling work. But these are exams that can be easily “cracked”. There’s a whole after-school tuition industry dedicated to this, and school boards have also introduced more opportunities like multiple choice questions for students to score better.

 

This isn’t a problem in itself, because exams have to evolve with the times. The real problem starts when an examiner gets involved. 

 

In 2017, online news portal Firstpost had published a semi-expository account by two researchers who allege that skewed marking by different school boards have led to massive grade inflation in marks over the years. In fact, they call it a farcical “grade distortion”. The report goes into great detail about the subjectivity of marking and the logistics of getting through literally thousands of answer sheets on time. But it also devotes a lot of time to the specific issue of “keywords”.

A teacher, who has been ICSE chief coordinator…said that the marking scheme was unacceptably biased in favour of 'keywords'. In what he said was grossly unfair to students, the marking scheme and keywords themselves change substantially from year-to-year, with little transparency or basis. Giving an example from Biology… till a few years back the word "solvent", and not "water", was accepted as correct in the definition of the process of osmosis. But an abrupt and unannounced change meant the latter started being accepted as correct.
CBSE Class 12th 2017 board exam results withheld: Grade distortion is a serious public policy problem, Firstpost
The marking is arbitrary but, on the whole, boards have become increasingly geared to pass people by creating a weird system of "parity score" buckets.

(There's a spike at 33 as scores are allegedly "upped" to make students pass. Everyone who scores between 74% and 95% are rationalised to 95%. Source: Firstpost report)

 

The "marksflation" is more than apparent in this graph.

(Source: Firstpost report)

 

System 1, which should be based on an objective marking scheme, has become subjective, arbitrary, and unpredictable. Politically too, it looks better for states to send out a horde of 95%-ers, instead of a deflated student crowd hobbled with low scores and dim prospects. During the pandemic year, most individual schools had the reins on scoring their students, which is unprecedented. So obviously, no one failed, and according to teachers I’ve spoken with, marks were skewed upwards because, hey, why wouldn’t you want to make your school look good in a competitive market?

 

This is where System 2 comes into play, which is everything that happens once the boards have jettisoned their high-scorers. System 2 is under the control of public and private universities who decide what their admission criteria is going to be. Well, private universities decide.

 

Public universities—particularly DU—have little choice but to chisel their system to serve an inflexible statistic. And it’s moving in the exact opposite direction to the marksflation process.

 

To understand why this happened, we need to turn the clock back to the 1960s. Pankaj Jha, a professor of history at Lady Shri Ram college—notorious for its 100% cut-offs—can’t remember a time when marks were not a criterion for admission. “But every college, and even departments within colleges, had a lot of latitude in admissions. There was a difference between what different colleges or departments looked for. It wasn’t uniform. Certain subjects would carry more weightage,” Jha told me over a phone call. Jha himself is a product of DU, and remembers how female students got a 5% marks concession during his admissions process in 1987.

 

Too much latitude though meant too much subjectivity. And everything outside the DU system was pushing against it. There was an “arbitrariness” to the process, says Jha, which wasn’t very transparent. Teachers could exercise their “privilege” and have biases in favour of, say, English-medium students. College politics also changed, and more power went to the head, instead of individual departments. Jha says that over the last four decades, the DU admission process has moved away from arbitrariness, and stripped a complex and subjective process down to a single statistic.

 

The cut-off.

 

And since cut-offs are the only yardstick, colleges are forced to push the ceiling to its absolute height—the 100%—in order to balance admissions with limited infrastructure. 

 

System 1 became more arbitrary and inclusive.

 

System 2 became more objective and exclusive.

 

Stuck in the middle are students—with way too many marks, but a shocking lack of options.

 

I know what you’re thinking. DU isn’t the only central university in India. Can’t students apply anywhere else? Just avoid this cut-off nonsense?

(Source: Livemint)

 

That’s easier said than done, especially when state-run colleges and universities have declined in quality and infrastructure. And through policy, states have chosen to promote privatise college education instead of pouring more money or time into their own state-run institutions. 

 

Private institutions have their own, time-wrought gatekeeper that trumps marks. It’s money.

 

The perfect score should lead to a perfect future. But these two imperfect public education systems, that should be working in tandem, are working against each other. To break out of these vicious cycles, one score has to matter less. The other will automatically temper itself.  

Back Bench
 

Aspiring doctors pushed for a #RENEET after the question paper for NEET, a centralised medical exam, was leaked via WhatsApp. A Supreme Court bench decided not to cancel the exam, despite the breach. But a cancellation would've worked just fine for Tamil Nadu's chief minister, who's asked 12 other states to join his chorus against the NEET exam because it has "undermined diverse social representation in higher medical studies".

 

Vedantu officially became India's fifth edtech unicorn. In a year full of IPO promises and unmitigated funding, it's a milestone that the company's been looking forward to. Guess what happened a day later? Byju's raised its latest round at a US$18 billion valuation, moving the due north for the sector a little further. It must be frustrating to be anyone but Byju's just now.

 

Schools are gradually re-opening for younger grades too. But full attendance is a far cry away. Maybe it's time to think about edtech in schools, not after it.

Share this edition
 
Thank you for reading the inaugural issue of Ed Set Go. Write to me at edsetgo@the-ken.com with suggestions, feedback, and tips, and I'll be back next week with a brand-new edition.
 
In the meantime, watch this space for more exciting products coming your way.
 
Oh, and if you want to share this edition, the link is below. Or you can just tap on the buttons below.
 
Take care.
 
Regards,
Olina Banerji
Ed Set Go by The Ken
The one-stop for the biggest shifts in India's $180 billion education market. Served hot and weekly, Thursdays.
 
Know someone who would like Ed Set Go?
 
Want to receive Ed Set Go every week?
Ed Set Go is published by The Ken—a digital, subscription-driven publication focussing on technology, business, science and healthcare.
Follow The Ken on Twitter, Facebook, and LinkedIn
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Buterin’s billion-dollar Covid relief donation shrinks to $381 million

Tokenised by The Ken
Tokenised is your weekly read to navigate and mine the rich vein of crypto developments that flow through India and SouthEast Asia
Good Afternoon Jigar,
 

I hope you enjoyed Seema’s new newsletter Green Margins today morning. She laid out how India could soon be knocking on the doors of an energy crisis, quite like Europe and China, and how these frequent crises are a symptom of the bigger climate questions that face the world. If you haven’t read it yet, I highly recommend that you do. 

 

But now, after a retail therapy break courtesy Seetharaman and a sobering climate change piece from Seema, we’re back to finance. But not the familiar kind. 

 

With a combined market cap of US$2.2 trillion, cryptocurrencies have become too big to ignore but are still shrouded in many unanswered questions. Crypto companies have popped up all over the map and I am hoping this newsletter becomes a steady part of your information diet. Especially if you’re curious about the dizzying pace of developments in this sector. 

 

Each Wednesday at 4 pm India time, Tokenised will land in your inbox with stories from India and Southeast Asia’s crypto-ecosystem. 

 

We will keep the “x coin’s price went up, y’s went down” trope at arm’s length to focus, instead, on the utility these tokens actually hope to offer. And whether they live up to these promises. After all, that’s a tenet of ours here at The Ken: Others tell you the ‘what’, we tell you the ‘so what?’

 

Another principle we live by wholeheartedly is to listen to our readers and, to the best of our ability, shape our coverage to meet their needs. So please feel free to reach out to me with any questions, feedback, or topics you’d like covered at tokenised@the-ken.com. 

 

With that, let’s dive right into this week’s edition:

Vitalik Buterin's billion-dollar Covid relief donation shrinks to $381 Million
 

Imagine dispatching a US$100 cheque to a charity and finding out that by the time it made it to their account, it lost over 60% of its value. 

 

That’s pretty much what played out with a donation made by Vitalik Buterin, founder of the Ethereum blockchain, towards Covid-related relief work in India. 

 

In May 2021, the country was in the grip of a terrifying second wave of Covid infections and help started pouring in from every direction. One unusual source was a donation of crypto meme tokens, worth US$1.2 billion at the time, made by Buterin. 

 

Around the same time that India was grappling with a resurgent pandemic, creators of a dog-themed crypto token called Shiba Inu gifted Buterin 50% of its overall supply—about 500 trillion tokens. The gift was part of a marketing stunt that eventually backfired, but it is also the genesis point for our story. 

 

Shiba Inu is a copycat of Dogecoin, another dog-themed crypto token created as a joke. While Dogecoin has limited inherent value and its creators did not intend for it to be taken seriously, it is wildly popular and has a market capitalization of US$31 billion. 

 

Shortly after receiving them, Buterin destroyed 90% of the Shiba tokens and gave the rest away as charity. He donated 50 trillion tokens to India Covid Crypto Relief, a fund set up by Indian blockchain entrepreneur Sandeep Naliwal. 

 

“When Vitalik’s donation came in, to be honest, it was a total surprise,” Punit Agarwal, a volunteer with the fund, told The Ken. The fund had collected about Rs 50 crore (US$6.7 million) up until then and was beginning to think about how to raise more. Buterin’s donation took care of that problem, but came with a few conundrums of its own. 

 

To begin with, it triggered a 50% drop in the token’s price. Token holders figured that the massive donation would be liquidated, putting downward pressure on Shiba’s price, and decided to front-run the dip by selling their own holdings. 

 

From trading at US$0.000032 on 12 May, 2021—the day the donation was made—Shiba Inu’s price dropped to US$0.000016 by the morning of May 13, 2021. 

 

“Since it was in Shiba, there was peer pressure from volunteers... ‘Hey! Sell. Sell. Sell,’” Agarwal said. Eventually, the fund decided not to sell all of it at once because they also wanted to protect retail investors who had put their money into the token, he added.  

[Source: CoinMarketCap]

 

The fund started looking for market makers (wholesale buyers and sellers in capital markets) to help liquidate the tokens in tranches instead. Wintermute, an algorithmic market maker that works with marquee crypto  exchanges such as Coinbase, Kraken, and FTX, volunteered its services and proposed a plan of action to convert the Shiba tokens into USDC, a token that tracks the value of the US dollar. 

 

“It’s not often that we can use these trading algorithms for anything but making money. So it was a great opportunity to use them for a good cause,” Evgeny Gaevoy, chief executive at Wintermute, told The Ken. He added that each Shiba tranche worth about US$50-70 million took about a week to sell. 

 

Over the next few months the Shiba Inu tokens were sold in the open market and converted to USDC. The sale concluded only in the last week of September and by the time the dust settled, US$1.2 billion had become US$381 million. The value erosion was the result of both price fluctuations and a sobering of the initial excitement around Shiba. 

[Source: India’s Crypto Covid Relief]

 

But getting the tokens into USDC was just one leg of the marathon. The other half was dealing with onerous regulations that govern foreign contributions to charities in India. Having converted Shiba into the stablecoin, the fund then converted the stablecoin into dollars and moved it into a US bank account used by its UAE-based entity. 

 

Then the funds were moved to the accounts of India-based NGOs that are approved by the central government to receive foreign contributions under the Foreign Contribution Regulation Act (FCRA). “Basically the government has put up a notice that all the NGOs that have the FCRA [license] should have only one account, which is at the State Bank of India’s Parliament Street branch” in New Delhi, said Agarwal. 

The relief fund has dispatched about US$37 million to aid organizations and research institutes such as the Indian Institute of Science (IISC), UNICEF, and Goonj, according to records shared on its website. While the donation to UNICEF went towards procuring injection syringes for vaccinations, the money given to IISC will be used to help set up a genome sequencing lab.

 

“Now we’re focusing towards long-term medical infrastructure for India,” Nailwal told The Ken. The fund is currently sitting on about US$410 million in crypto tokens and US$14 million in bank accounts, and while Naliwal says there isn’t a strict timeline around deploying it, the fund has become famous among NGO circles in India since, “all NGO(s) know that… Crypto Relief has money.” The fund gets about 15 to 20 pitches from aid groups and charities each month. 

 

This story serves to illustrate two things quite well: It’s probably not a great idea to make large donations in illiquid meme tokens. And when it comes to stories in the crypto-sphere, looking beyond the headline (billion dollar donation, anyone?) is all the more important. 

 

Though a counterpoint worth remembering here is that Buterin’s Shiba donation produced some good out of a token that might have otherwise remained just another speculative crypto-asset for people to bet on. Valuations change direction more frequently than the wind in crypto land, but if something good comes out of it, it’s perhaps worth a hat tip. 

 

That’s also part of the reason why I chose this as the first spotlight story for Tokenised; a way to urge you to sift through the hype when you think about this buzzy technology. And I’ll surely be around to keep nudging you with reminders such as this one. 

 

With that, let’s turn to some other notable things that happened in the crypto-world over the past few days. 

At a Glance
 
  • Indian crypto exchange CoinSwitch Kuber raised a $260 million funding round co-led by Andreessen Horowitz and Coinbase Ventures. [TechCrunch]
     
  • Bhutan’s central bank has partnered up with crypto firm Ripple to pilot a central bank digital currency built on a private blockchain. [Ripple]
     
  • India’s crypto market ballooned by 641% over the last year, according to blockchain analytics firm Chainalysis. Vietnam and Pakistan were also key contributors to the growth of crypto in the region. [Bloomberg]
     
  • Twitter is working on a way for users to verify their non-fungible token (NFT) profile images. A preview shared by an executive at the microblogging giant shows that it’ll involve users linking their crypto wallets with the platform. [Twitter]
     
  • As China clamps down on crypto businesses and many of them leave Hong Kong, Singapore is betting that it has struck the right balance between caution and regulation. [Financial Times]
Back of the envelope
 

Stablecoin -  Crypto-assets that track the value of a national currency like the US Dollar, British Pound Sterling, or Chinese Yuan. They usually don’t change too much in value unlike other volatile crypto-assets that are pegged to little but trader sentiment.

 

Popular stablecoins - Tether (USDT), USD Coin (USDC), Binance USD (BUSD)

 

Market capitalisation - Tether, USD Coin and Binance USD have a combined market capitalization of about US$113 billion. 

What caught my eye this week

Blockchain play-to-earn game Axie Infinity now has a bigger market capitalisation than Ubisoft and Zynga, according to Messari’s research. Ubisoft makes popular games like Assassin's Creed and Watch Dogs, and Zynga is the studio behind titles like Farmville and Zynga Poker. 

 

As reported by The Ken’s Jon Russell, the play-to-earn game has exploded in the Philippines and other countries in the region where players are managing to earn more playing than through regular employment. Venture capital has also begun pouring into blockchain games with VC juggernaut Andreessen Horowitz leading a US$152 million dollar funding round in Sky Mavis, the studio behind Axie Infinity.

Share this edition
 

That's all for this week's edition. I'll see you again next week. If you liked this first issue of Tokenised, please do share it

 

https://the-ken.com/tokenised-edition/buterins-billion-dollar-covid-relief-donation-shrinks-to-381-million/​

 

Also, do keep an eye out for a stellar newsletter from my colleague Olina tomorrow morning.

Take care.
 
Regards,
Jaspreet Kalra
Tokenised by The Ken
Tokenised is your weekly read to navigate and mine the rich vein of crypto developments that flow through India and SouthEast Asia
 
Know someone who would like Tokenised?
 
Want to receive Tokenised every week?
Tokenised is published by The Ken—a digital, subscription-driven publication focussing on technology, business, science and healthcare.
Follow The Ken on Twitter, Facebook, and LinkedIn
This email was sent to jigar37.iilm09@blogger.com
Something wrong? Tell us at support@the-ken.com
Want to unsubscribe from our weekly newsletter, Tokenised? Click here. Or set your email preferences here
© 2021  The Ken