Cryptocurrencies have been steadily gaining in popularity around the globe. As more and more people begin to understand and trust these currencies, crypto continues to gain steam and to be used in more everyday ways. One way that cryptocurrencies are becoming more mainstream is in the charity sector.
Several well-known charities have begun to accept cryptocurrency as donations, paving the way for more entities to embrace digital currencies. But are cryptocurrency donations just a fad, or will they become the norm?
Let’s look at some of the charities that are beginning to accept cryptocurrency donations and why this form of digital currency could be the next great thing for digital donors.
Major Charities Accepting Cryptocurrency
You may be surprised to see some well-known names among the list of charities accepting cryptocurrency donations.
Save the Children
Medecins Sans Frontieres Australia, or “Doctors Without Borders” accepts eight different types of cryptocurrency, including Bitcoin and Ethereum. MSF points out that donors can maximise the impact of their donation by using cryptocurrencies since they are not subject to the capital gains tax.
Unicef is another charity with offices across the globe. It accepts donations of cryptocurrency in several different countries, including New Zealand and the USA.
These are just a few of the larger charities beginning to accept cryptocurrency donations. As more people start to use digital currencies, you’ll likely see more charities and other organisations accepting crypto donations as confidence in the currency grows.
Sydney Children’s Hospital Foundation
The Sydney Children’s Hospital Foundation’s annual fundraiser announced that it would accept cryptocurrency to better serve its donors. The 2021 fundraising event even included the auction of an NFT digital artwork donated by digital artist Hipworth.
Benefits of Cryptocurrency Donations
Cryptocurrency donations have several benefits that make them appealing for both donors and the charity accepting the donations. When you see how these benefits align with the beliefs of many charities, offering the ability to donate cryptocurrencies makes a great deal of sense.
Blockchain technology utilises an ‘open ledger’ system that allows everyone to see where the money goes. Although donors can remain anonymous, everyone can see exactly where the cryptocurrency goes right up until it hits its final destination. This transparency means that donors can follow the donation trail right to where the money is finally used, which helps build trust between charities and their donors.
Optimise Tax Efficiency
Donors who utilise cryptocurrencies for donations can circumvent capital gains tax. Donations in cryptocurrency are also tax deductible in the same way that regular donations are.
Increase Awareness of and Use of Cryptocurrencies
Cryptocurrencies are still the new kid on the block when it comes to investments, but that’s changing. By offering the opportunity for individuals and corporations to donate cryptocurrency, charitable organisations can offer donors greater choice in how they are able to make a positive impact.
Cryptocurrency is More Accessible
For anyone who doesn’t have access to a bank account or credit card, making a donation can seem impossible. But if they have access to the internet and a cryptocurrency wallet, they can donate easily.
For charities that focus on ending inequality, cryptocurrencies are a perfect fit. By making it easier for everyone to help out, it becomes easier to help more people.
Cuts Out the Middleman
Often, charities lose money in processing fees from banks when they use their services to process incoming donations. Cryptocurrencies like Bitcoin and Ethereum don’t require the use of a bank to process transactions. Blockchain transactions have minimal costs in comparison to bank transactions, and they’re practically instantaneous, too.
Using NFTs to Encourage Donations
There’s been a rise in the use of NFTs, or non-fungible tokens, recently. NFTs are entirely secure, non-transferable digital items that live online in secure Blockchains. These digital ‘tokens’ are one-of-a-kind and perfect for stirring up interest in charities.
One-off pieces of artwork, music, videos, and other exclusive digital content are ideal for auctions that use cryptocurrencies as payment. Whether you believe NFTs are a passing trend or not, some of the most expensive NFTs sold online have raised millions for various charities.
NFTs and anything else that encourage charitable donations using cryptocurrency only strengthens the market and helps normalise blockchain technology in the financial world. Ultimately, the use of cryptocurrencies could help everyone donate more easily, and they can help ensure that you know exactly where your money goes when you give it.
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