There is so much cryptocurrencies can do. For some it is a way to take the monetary power out of governments and institutions. Others simply see it as an alternative to the status quo. For many it is a way to enable positive change in a society that does not allow so otherwise. In many ways cryptocurrencies are a fundamentally democratic tool.
But are cryptocurrencies actually making the world a better place? Let’s have a look.
Charity on the Blockchain
Charitable causes were never a primary topic for blockchain projects. Bitcoin came with an ideology and clear statement attached from the very beginning. While Bitcoin and its whitepaper were focussed on the monetary issues of our time, the ideas behind it reach much further. Bitcoin as a driver of positive change by democratising the monetary system gives us the opportunity to fix other systems otherwise dependent on a broken monetary system.
So why not charities and NGOs? Many of such organisations are not just dependent on a strong support base from society but are also at the mercy of banks and governments. For them it makes a lot of sense to try to loosen that tight grip as many organisations have been punished by governments and centralised payment services in the past.
NGOs, nonprofits and charities can tap into a completely new revenue stream with cryptocurrencies which enables them to raise more money than via traditional sources. Besides that accepting cryptocurrencies makes them appear tech-savvy and progressive. An organisation that is able to adapt new technologies fast is also able to be more relevant in the future, making an investment seem like a safer choice. Many nonprofits have a great use case for blockchains and they can be utilised in everyday operations.
All things considered traditional NGOs and charities can benefit greatly from accepting cryptocurrencies, but the crypto community itself did not wait for such organisations to adopt their technology. Instead they created their own.
The Pineapple Fund
Have you heard of the Pineapple Fund? This fund is not just an insane story of crypto riches but also a story which can restore your faith in humanity again. The Pineapple Fund was created by an early Bitcoin investor who likes pineapples and became insanely rich through Bitcoin’s rise. However, after having enough money to live a comfortable life, this person decided to donate the rest. Not for lobbying for cryptocurrencies, not for personal interest, not to become famous – simply to make the world a better place.
The Pineapple fund has donated $55 million to a wide range of projects, including:
- Clean water for developing nations
- Open Education
- Open Source Software
- Support for minorities
- Psychological and Medical Research
- Wildlife and Environmental Preservation
- And many, many more…
And guess what? That person stayed completely anonymous with zero interest in personal fame. That is the true spirit of cryptocurrencies.
Blockchain Charity Foundation
The Pineapple fund is a great example but there are bigger organisations taking crypto charity serious too. Binance is one of the biggest and best exchanges for trading cryptocurrencies and it recently announced their charity foundation. Their Blockchain Charity Foundation aim is:
Blockchain Charity Foundation (BCF) is dedicated to the advancement of blockchain-enabled philanthropy towards achieving global sustainable development. BCF aims to transform philanthropy by developing the world’s first decentralized charity foundation to build a future where blockchain technology can be used to end all forms of poverty and inequality, advance sustainable development and ensure that no one is left behind.
Since charity is all about execution it is great to see a company with such a high profile taking charge.
The Giving Block
One of the organisations working to bring blockchain to the nonprofit space is The Giving Block. It was started because there was a lack of awareness and understanding of blockchain and cryptocurrencies in the traditional nonprofit space. Less than 1% of nonprofits accept cryptocurrencies, yet last year alone 100’s of millions of dollars were donated in cryptocurrency.
The Giving Block set out to change this and educate nonprofits and bring them up to speed on all things blockchain and cryptocurrency. With their consulting effort they help organisations accept cryptocurrencies. One of their customers is the Lupus Foundation who recently started to accept donations in cryptocurrencies and held a big event in New York City.
Why Would You Donate Crypto
By now we have established why it makes perfect sense for organisations to accept cryptocurrencies. But why would anyone want to donate cryptocurrencies? There are two main reasons:
You Can Save on Taxes
In the United States and many other countries you can save on your taxes big time. By donating your cryptocurrencies you can unload assets which would otherwise result in high capital gains taxes. At the same time you can collect a charitable gains tax deduction. So one donation can change your yearly taxes from a big payday to a day of great savings.
If you already own cryptocurrencies it makes sense to spend cryptocurrencies. Why on earth would you first convert it to Fiat money, pay taxes on that and then make your donation? Instead you can just pop out your hardware wallet and send your funds, any day of the week – no waiting for banks to process your payment.
What The Future Holds
As of now there are few charities who do accept cryptocurrencies. So what is stopping them?
There is a multitude of reasons but the biggest one is probably a lack of awareness and understanding of how blockchains and cryptocurrencies work. The good news is that there are companies such as The Giving Block who educate nonprofits in cryptocurrency topics and help them accept them for donations. Just like adoption is happening with traditional businesses so are more and more Non-profits. Nonprofits were skeptical about accepting credit card donations 15 years ago. Now almost all accept them. Cryptocurrencies are headed for the same path.
The Giving Block has seen some great results already:
Once you are able to get passed some initial misconceptions, something seems to click and the leadership teams see the massive potential from accepting donations and also engaging with this new community.
With more charities adopting cryptocurrencies it also increases the exposure of cryptocurrencies and blockchain in an environment which had very little contact with such a new technology so far. Ultimately this leads to more exposure in new funding circles and unlocks a new investment potential. Every new nonprofit that starts accepting cryptocurrencies is a driver of adoption of tomorrow.