Over half of the top 100 U.S. charities now take crypto

Philanthropy has taken a turn for the better as charities stepped up their efforts to shatter their goals and collect wealth from modern donors to redirect them to the nation’s most important causes. United Way Worldwide, Feeding America, St. Jude’s, Good 360, Direct Relief, and more of the main U.S. charities not only accept crypto donations, but set the stage for those who slept on this idea to do so. Digital money represents an increasingly bigger opportunity for NGOs and NPOs to grab massive donations, which is why more and more charities turn around to craft fundraising strategies that help them unlock a new, increasingly weightier (and wealthier) donor category. There aren’t many industries able to tap into a user base worth over $2TN, and charities seem to finally acknowledge this and act upon this opportunity, even if it’s been three years since the sector became the crypto-friendliest field worldwide. 

With over 1,300 nonprofit organizations worldwide now embracing donations in the form of Bitcoin, Ethereum, Doge, Pepe, and so forth, it’s safe to say that this trend is a solid step towards a world where philanthropy is getting more inclusive and secure. It’s not just the trader community that rejoices over a potential betterment of the current Pepe price prediction but also the broader philanthropist arena, as it translates to heightening future donation greenbacks for nonprofits. How and why? When did crypto donations become a thing?

Tracing back to the beginnings 

While the concept of crypto dates back to when Bitcoin was launched in 2009, it wasn’t until 2013 that a digital money donation would stop being a far-fetched vision. Save the Children U.S. was the pioneering global grant maker to receive a BTC gift; yet the practice can’t be said to have gained ground back then. Instead, 2020 marked the year crypto donations picked up speed, with 2021 recording the highest activity levels up to that point. Almost half of crypto investors funneled $1K or more to charities in 2020 – a stark contrast to 33% of the overall investor population. Even better, in 2021, the most profitable year for crypto giving, a whopping $331MN got funneled into Fidelity Charitable, the U.S.’s leading charity. 

If the figures above spark joy, here are other glad tidings. According to the outlet, the number of nonprofits participating in Giving Block’s yearly fundraising project, CryptoGivingTuesday, increased by 839% from 2020 to 2021. As one of the most notable industry trends, Bitcoin, Ethereum, Pepe, and other cryptos picking up in the charity landscape are must-watch metrics to keep up with.

Crypto aids mean more revenue streams

One doesn’t need prior knowledge of all the ins and outs of crypto, as the abundance of information can make the empathetic act of donating a bit intimidating. Those donating to crypto are reasonably well-versed in the industry, and many possess crypto with scopes like trading or reinvesting. Another category of donors has crypto assets simply because their services may be rewarded in digital money – i.e. freelancing. If a business wants to implement payment methods to transact crypto, the crypto landscape is anticipated to become friendlier ever since Trump came out on top after the presidential elections. So, there’s no better way to do it than now. 

It’s essential to be informed about the legal aspects of the specific state where crypto-based charity is about to unfold. But given the rising trend of crypto donations and the new waves of interested parties that come to the table, one can find the relevant help needed quite rapidly – or more quickly compared to a few years ago. A new revenue stream equals a new target audience and translates to more opportunities to raise money to support a beloved cause. Given the current donor apathy and the many humanitarian pleas that naturally impact the contributions’ percentage shares, having a backup and another giver base to interact with means greater chances of meeting fundraising goals. Crypto remains this decade’s best-performing asset class, overtaking the big stock market by almost 1,000%, a tall feat to witness.

Where digital money meets philanthropy

Despite the well-known volatility of the crypto market, charitable use of virtual money remains strong, offering a sneak peek into how the sector transforms under the magic of tech advancements. The Giving Block went through data covering three years to make predictions and deduct that benevolent cryptocurrency donations to nonprofits through the donation system alone will reach a heartwarming $10BN by the last quarter of 2032. More projects could contribute to the notable increase in charitable giving in the U.S., as you will see, making possible a share of 2% of the whole current landscape of donations. 

• Stablecoins ride the wave, with USD Coin leading the pack in 2022 with a solid 44% of the charity volume. Ether followed and stood at 24%, while the primary crypto, Bitcoin, came third with an encouraging 17% donation volume.

• At the same time, decentralized autonomous organization (DAO) and non-fungible token philanthropy started to pick up in 2022. Letting Bitcoin and the crew aside, these new types of donation strategies are effective ways of amassing and using funds that lead to ripples of change. Thanks to the rising web3 community’s strength during times of crisis, heightened activity is expected. 

As a quick heads-up 

Charities must tread carefully regardless of the state they belong to, should they want to implement crypto revenue payment options. The areas to look into range from anti-money laundering aspects to compliance rules, and because there’s still a mismatch between crypto and traditional financial systems, due diligence must be carried out well before getting to the bridge.

The following aspects are best to be assessed:  

• Taxations – charities might be subject to VAT depending on a range of aspects 

• Anti-Money Laundering (AML) and Financial Action Task Force (FATF)

• Proactive risk approaching strategies and management 

• Partnerships with go-betweens or holding assets and exchanging in-home

• Custody and safekeeping options. 

Endnote

Billions of greenbacks have been poured into charitable organizations via crypto, and even more is expected to be funneled there as the market grows and benevolent givers profit from the offered and unmatched tax breaks at stake. If you want to jump on the bandwagon, make an effort to familiarize yourself with both the pros and cons.