Private foundations and donors have for a long time supported funding charities around the world. Presently, their strength is felt more than ever, with them overtaking many aid bodies and the world’s governments as the biggest nonprofit sector donors.
Since crypto’s early days, people have always seen it as a tool to help developing countries to centralize power and address income inequality. Hence the introduction of cryptocurrency donations to nonprofits.
As of November 2018, the cryptocurrencies market cap is around $417 billion. Thus, you can utilize crypto to support a worthy cause that you love. Presently, many nonprofits like Food for Life Global, a hunger relief organization serving freshly cooked vegan meals to school children across the globe, offer crypto donations.
The following are reasons to make crypto donations to charities. Suppose you wish to donate to Food for Life Global or any other nonprofit that accepts crypto, head over to their cryptocurrency donations page to donate easily.
One primary reason some people prefer donating crypto to charity is the ease of transaction. Crypto donations are faster, cost-effective, and transparent than conventional currencies.
Due to the public nature of blockchain ledger, the money flow is more transparent than traditional currency systems requiring third parties to monitor and intervene in transactions. Thus, with crypto donations, the transaction costs are reduced while saving time.
Low Processing Fees
Due to the low or zero cost of processing crypto transactions, it’s the best method of donating cryptocurrency to charity. Thus, with a crypto donation, more of the funds get to the charities’ mission.
More so, when filing their taxes, the nonprofit can classify the received donation under a non-cash gift.
Cryptos are fast becoming more secure nowadays. Advanced technical experts are all diverting into the industry and building the needed infrastructure to secure crypto storage.
Presently, the insurance industry introduces policies aimed at covering certain losses. That way, would-be donors will have greater peace of mind when contributing with crypto.
Easier to Accept
Cryptocurrency donations are perfect for international nonprofits because it’s easier for them to accept such funds. With an agency handling the cryptocurrency flow, you can easily accept donations from across the globe without fearing banking hold-ups and exchange fees while your monies are being reviewed.
One reason to donate cryptos to charities is the anonymity it provides donors. While there’s accountability with the public ledger, it’s not tied to personal identification. Thus, it helps expand nonprofits’ donor base.
Philanthropists wishing to remain anonymous will benefit from this, unlike the traditional method of donating to charities. Such donors will have to trust the nonprofit to keep their identity hidden.
Suppose you might not want to donate due to these procedures; contributing with cryptocurrency might help put your mind at ease.
Appeals to Millenials
Charity cryptocurrency donations appeal to wealthy, tech-savvy demographics, especially Millennials. Many nonprofits entail innovation in support, whether it’s aiding inequalities in educational opportunities, people with disabilities, or economic impoverishment.
Due to its status as new technology and because it blends with entrepreneurship, buying or donating in crypto is advantageous. According to an Edelman study, 74 percent of affluent millennials hope on innovations like blockchain for more financial systems security.
As a nonprofit, accepting crypto donations will ensure you stay in the face of affluent demographics.
How Charities Can Stay Safe While Accepting Cryptos
As a charity, it’d be best to accept cryptocurrency donations. However, consider putting in measures to increase your security while accepting cryptocurrency. Some of the steps to take include:
Use a Well-Known Platform
One primary way to stay safe while accepting crypto donations is by using a well-known platform. Platforms like BitPay is the leading crypto transaction forum for charities, even endorsed by Charity Navigator. You can also use Coinbase, another popular crypto platform.
Get Insight From Other Charities That Accept Crypto
As a charity looking to incorporate crypto donation, it’d be best to speak with other nonprofits already using the system. I’m sure they’ll have crucial tips to share for your safety. They may have insights on assessing crypto donors and the key players likely to make donations.
Get a Financial Advisor
As a charity looking to incorporate crypto donations, ensure you hire a good financial advisor with cryptocurrency experience. You’ll want someone with professional know-how for your safety.
Consider working with an expert with direct experience, dedicated to staying updated with the crypto regulation industry. That way, you’ll be best informed on how to proceed with incorporating cryptocurrency donations.
Treat Your Donation Like a Security
Rather than exchanging your cryptos for fiat money, consider treating some parts of your cryptocurrency donation like security. While you may face depreciation, your board members may feel more comfortable as crypto plays out, and you’ll see an increase in the value of your crypto holdings when you sell when the coins rise.
Know Your Tax Laws
Crypto is considered personal property by the IRS and as such treats cryptocurrency donation as in-kind, meaning it’s tax-deductible. Thus, the recipient needs to carefully document the fund and send a thank-you note to show that no services or goods were exchanged for the contribution.
When choosing a charity that deserves your donation, it’d be best to focus on what matters most to you. Do some reflection and decide on a cause that appeals to your heart.
While a small financial contribution can go a long way to help charities achieve their aim, you’ve got to choose a good nonprofit for your donation carefully. The sheer number of charities existing has made it difficult to sift the nonprofits with worthy causes from scams easily. Thus, you might get overwhelmed when trying to decide on the one deserving of your donation.
Doing your research is a vital step to take before donating. Suppose you’d prefer to make crypto donations; we’ve outlined the reasons to go through that route. So go ahead and be the change! That way, you can feel more confident that your donation will end up in the hands of a charity that will make a maximum of your funds.
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