The Rise of Crypto Philanthropy

Philanthropy and charitable giving are important parts of American culture. They remain vital in addressing our country's most pressing social, environmental, and economic issues.

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Giving USA produces the longest-running annual report on philanthropy. Year after year, Americans exceed the previous year's total dollars donated. This trend is why Engiven Founder and CEO James Lawrence to made the following projection in a recent blog post:

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"I believe that within three to five years, crypto giving will be a meaningful percentage of the $450B annual gifts made by individuals in the US. Perhaps $10-$20 billion a year."

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Despite recent black swan events in crypto, it continues to be a significant piece in the future of generosity.

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Crypto adoption is growing

Cryptocurrency adoption is growing. More people are investing their fiat currency in cryptocurrencies, more businesses accept them as payment, and governments recognize their potential.

• Increased User Base: According to a report by Crypto.com, the number of global cryptocurrency users doubled from 100 million in January 2021 to 200 million in May 2021. New users join the movement every day.
• Growing Investment: Institutional investment in cryptocurrency has been increasing. A report by Fidelity Digital Assets revealed that almost 80% of institutional investors find something appealing about digital assets. 36% already have some form of exposure to cryptocurrency.
• Crypto Payment Services: Major companies such as PayPal, Square, and Visa have started offering cryptocurrency payment services to their customers. PayPal has allowed its US customers to buy, hold and sell cryptocurrencies and enabled crypto payments at millions of merchants worldwide.
• Increased Acceptance by Merchants: More merchants are accepting cryptocurrencies as payment. In Q1 of 2021, the number of merchants that accept Bitcoin on the BitPay platform grew by 37%.
• Government Adoption: Governments worldwide are starting to recognize and adopt cryptocurrencies. For example, El Salvador became the first country to make Bitcoin legal tender in September 2021. Other countries are also exploring the potential of central bank digital currency (CBDC).

Crypto vs. Cash: Benefits to making charitable contributions with digital currencies

Donating cryptocurrencies to charitable organizations offers several advantages over cash donations. Those include tax benefits, easier record-keeping, greater flexibility, and greater transparency.

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One advantage of donating cryptocurrencies in the United States is the potential for tax benefits. Per the IRS, donating appreciated cryptocurrencies to charitable organizations may allow donors to avoid capital gains taxes. It may also allow them to receive a tax deduction for the total fair market value of the donated assets.

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Donating cryptocurrencies can also be easier to track and document than cash donations. The blockchain applications that digital currencies use create a transparent and permanent record of all transactions. This simplifies the verification and documentation of contributions for tax purposes.

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➡️ Learn more about blockchain technology and how it works here: The Blockchain and Altcoins

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Another advantage of cryptocurrency giving is the added flexibility. Transactions that would otherwise be very complex can become more flexible. Charities can receive donations from anywhere worldwide without worrying about currency conversion, banking institutions' business hours, or transaction fees. Additionally, donors can easily donate fractional crypto assets, as digital currencies are highly divisible.

Finally, donating cryptocurrencies can provide greater transparency, which can help to increase accountability in the charitable sector. Public blockchain technologies create a permanent and transparent record of all transactions. This makes it easier for donors to verify that their contributions are being used as intended.

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Donating cryptocurrencies to charitable organizations can offer significant advantages over cash donations. Because of blockchain technology's unique features, donors and charities can operate in a more transparent, efficient, and impactful charitable sector.

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Crypto fundraising isn't as hard as you might think

For nonprofit organizations, staying informed about new financial technology is always a good idea. It behooves nonprofits and churches to adopt and implement new fintech solutions as early as possible. The more types of donations a nonprofit can accept, the more donations it is likely to receive.

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Every US-based 501(c)3 nonprofit organization can receive cash and check donations. By now, most can also receive digital payments via credit cards and other ACH solutions. But what about crypto?

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Over the last few years, many organizations have expressed timidity about crypto fundraising, so let's de-mistify it a bit. After reviewing thousands of our clients, we identified several crypto fundraising best practices that are excellent predictors of success:

1. Use the best product tier
2. Customize your giving widget
3. Put your giving form in the right spot
4. Engage the crypto community
5. Talk about crypto

➡️ You can read the full article here: 5 simple strategies that will 4x your crypto donations

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Crypto has a place in the future

The younger generations, particularly millennials and Generation Z, are changing the landscape of philanthropy. These diverse generations prioritize finding causes that align with their values. They will donate time and resources to organizations they perceive to be making a real impact.

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Unlike previous generations, millennials and Gen Z are native to technology and social media. Thus, they're incredibly comfortable and trusting using digital platforms to learn about, engage with, and donate to charitable causes.

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Nonprofits and charities that adapt to these changing trends will be successful fundraisers for years to come. They can adapt by leveraging technology, creating engaging content that resonates with younger donors, and accepting digital payments. Meeting millennials and Gen Zers in the digital space they already occupy will enfranchise them to a nonprofit and their mission.

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The 501(c)3 organizations that incorporate crypto into their fundraising strategy will be the leading nonprofit causes of the future.

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