While some political and corporate leaders have been eager to invest in and adopt cryptocurrencies, others are entirely hostile. Turkish President Tayyip Erdogan recently declared outright war on the Bitcoin network. President Erdoğan: "We Are At War" President Erdoğan expressed his opposition to Bitcoin in a meeting with Turkish students this Saturday. The event comes after one of them asked if the country's central bank would adopt cryptocurrencies. Erdogan responded with total rejection: "We have absolutely no intention of embracing cryptocurrencies. On the…
UNICEF stated that they wanted to explore the opportunities offered by cryptocurrencies as the digital currency gateway to shape future generations’ lives. Today the fund is up and running, and it accepts donations in bitcoin and ether.
This is not the only or the first global charitable organization to have recognized the value of cryptocurrencies. United States Fidelity Charitable signed up for crypto donations back in 2015 and has since raised over $100 million in many coins, including $BTC.
Other organizations with a global impact that accept cryptocurrency donations today include, American Red Cross, Wiki Leaks, Save the Children, Royal National Lifeboat Institution, and The Water Project. Recently Human Rights Foundation (HRF) also started accepting donations in Bitcoin.
These organizations have realized that cryptocurrencies offer many irrefutable benefits and advantages over fiat currencies. These include convenience, easy and low cross border transaction fees, global instant reach, transparency, new investment opportunities, and tax benefits.
Cryptocurrencies Offer Convenience and Tax Benefits to Donors and Charitable Organizations.
Taxes are always a sensitive subject to many, if not all, with many people feeling like governments worldwide take away more than they should if they should take people’s money at all. This is why donations in fiat currency may make people with the will to do good to pull back because they don’t want their goodwill to be taxed.
However, there is the convenience with cryptocurrencies, as crypto donors can write off their full donation amount because no capital gains taxation.
For example, if a philanthropic individual made a lot in cryptocurrency and wanted to donate it in fiat, they would be taxed around 20-30% of the amount. However, if the charity organizations accept crypto donations, the whole amount could instantaneously be transferred at meager transaction fees.
Donors feel good knowing their money isn’t being lost somewhere in banking fees, cross border taxation, or transactions, and charitable organizations are aware of this fact.
Reaching a Global Pool of Philanthropic Hearts
Giving is not about how much you’ve got or where you are, but fiat currencies have a way of taking this from people. Not everyone who wants to give may have access to the institutions affiliated with the organization they wish to donate to. If the process of getting the documentation right becomes a burden, people might shy away, despite their good intentions.
Cryptocurrencies have made it possible to jump over all those hoops. It has given global financial access to millions of people who had no hope of being traditionally banked for the next five to ten years.
Today, crypto donors only need access to the internet, a crypto wallet, or an exchange wallet to donate. It also opens up new avenue channels for these organizations as crypto makes even the smallest donation count.
Distributing Funds Conveniently Across International Borders
When organizations have projects running worldwide, there are always complexities involved in border regulations, financial instructions, and other factors that may slow down development progress.
Blockchain transactions take minutes to complete transactions independent of the location, and this is because most of the popular exchanges are centralized. There is a growing movement of decentralized exchanges that transfer crypto from wallet directly to wallet, and they are even faster, more secure, and reliable.
International crypto donation transfers reduce the time needed to move money from institution to institution and its fees. Another good thing is that it protects the money from corrupt governments and officials, which is a fact that has frustrated many charities, especially in regions that need help the most.
Decentralization in Cryptocurrency Promotes Security, Accountability, and Transparency
The way a blockchain network works is through distributed ledger technology that stores immutable records forever. This means that once information about a transaction is entered, it reflects on all other ledgers across the network for everyone to see, and it can’t be tampered with at all.
The ledgers are also maintained by a network of nodes or computers located anywhere around the world. It means that organizations do not have to worry about centralized servers that can be sabotaged or tampered with by someone with proper access. Another problem with centralized servers is building and maintenance costs, which are being phased out by blockchain technology.
Therefore, people can be held accountable for how they use the funds, and it can also help organizations during auditing and fundraising campaigns to attract more donors. Donors on the network can see other donors making contributions, and they can follow the money to see where and how the organization is using their donation.
Transparency promotes honesty and makes it easy to root out the bad seed while ensuring that funds are used for the purpose they were intended for. It also expands the funds’ reach to the development projects and benefits more people, which is always the goal of any charitable organization.
Investing Opportunities for Crypto Funds
While people might shy away from the crypto market because of outrageous volatility rates, it has one of the most rewarding returns, both for the long term and short term investment plans.
To understand volatility, consider the fluctuations in bitcoin’s price over the years, as the number one crypto coin by market capital and trade volume.
For instance, mass liquidation by a Chinese scammer with Plus Token wallets has been devastating the price of bitcoin for more than three months now in a pump and dump scheme that has cost investors millions of dollars.
There is also a lot of speculation in the cryptocurrency market, and since most coins, like Bitcoin, are not backed by anything, any slight panic causes huge losses. In the same way, there are always huge gains to be made from trading cryptocurrencies. Any traditional investor, especially where the stakes are high, would look at the prices of bitcoin prices since 2009 and advise against trading in it.
Charitable organizations should be not shy away from this; instead, they should consult with certified crypto analysts and institutional traders, as they are rarely wrong.
Evidently, some of the advantages people get from using crypto for transactions are unbelievable to people who are used to traditional banking. The crypto industry is still considered young and volatile, unlike established markets. Still, it is the fastest-growing market and attracts the best generations responsible for making decisions for future generations.
Joining the crypto movement for charitable organizations is crucial. It represents adapting to change because, just like the internet brought in the third industrial revolution, blockchain technology is here to start the fourth industrial revolution.