10 Reasons Nonprofits Should Dive into Crypto Philanthropy this Giving Season
As Giving Season 2023 approaches, countless nonprofits are putting the final touches on their fundraising blueprints, gearing up for the pivotal moments in their annual fundraising journey. In mapping out these plans, the influence of technology — especially the groundbreaking rise of cryptocurrency — cannot be overlooked.
With the momentum of the Web3 movement surging, it's imperative for nonprofits to stay ahead of the curve, leveraging this revolutionary technology to resonate with new audiences and diversify their fundraising strategies. So, as your organization readies itself for Giving Season, here are 10 compelling reasons to embed crypto philanthropy into your campaign.
1. It’s an opportunity to connect with a new generation of donors
At a time when nonprofits are struggling to onboard younger donors, crypto philanthropy presents an exciting opportunity to connect with a new donor base that is distinct from traditional donor populations. The average donor in the United States is 65 years old, putting nonprofits at risk as traditional donor populations begin to age out of the giving pool. In Web3, millennials and Gen Z are at the forefront, with 53% of crypto holders in the US being between the ages of 18 and 34. By embracing crypto donations, nonprofits can begin connecting with an entirely new donor demographic, helping to build a robust supporter base for the future.
2. It’s a signal to the community that you embrace innovation and transparency
Accepting cryptocurrency isn’t just a financial move; it’s a statement. It says, “We're innovative, we're transparent, and we're ready for the future.” Donors, especially those from younger demographics, value organizations that are progressive and not afraid to experiment with new technologies. By engaging with crypto donations, it demonstrates to the community that you are forward-thinking and believe in the importance of transparency, one of the pillars of Web3.
3. It’s a great way to connect with likeminded organizations and communities
The crypto world is full of builders, collectives, and projects aimed at creating a better world. No matter what the focus of your organization – whether it’s climate change, extreme poverty, or arts and culture – you will have no problem finding Web3-native projects with a similar focus. By stepping into the crypto sphere, nonprofits can form exciting partnerships and synergies with these projects, opening the door to all sorts of future collaborations and fundraising opportunities.
4. Crypto donors are very generous
What many find surprising is just how generous crypto donors really are. After all, there is the perception that cryptocurrency is only used for criminal purposes by shadowy basement-dwelling coders. This is simply not true. In fact, one study found that almost half of cryptocurrency owners donated $1,000 or more to charity in 2020. Interestingly, only about one third of the investor population as a whole donated $1000 or more during the same time period.
Another example can be found in #CryptoGivingTuesday in 2021, during the height of the crypto bull market. According to The Giving Block, one of the most prominent crypto giving platforms, the average crypto gift on #CryptoGivingTuesday was a whopping $12,600 USD, or 98.4x higher that the non-profit industry’s average donation size.
Now, of course it’s important to recognize that accepting crypto donations won’t immediately result in massive gifts. However, as you build your network in the community over time, there is a strong potential for generous donations to come your way.
5. It’s a great way to learn about Web3 and future use cases
Web3 is the next frontier of the internet, emphasizing openness, decentralization, and individual control over their own data and content. By engaging with crypto, nonprofits can educate themselves on this evolving landscape, and begin discovering new use cases, positioning themselves to harness its full potential. One of the biggest barriers for nonprofits engaging in Web3 is not knowing where to start. Crypto philanthropy presents a relatively easy, low risk entry point for your nonprofit to begin experimenting and learning.
6. It can help expand your organization’s reach globally
The Web3 ecosystem is truly global and presents an opportunity like no other to bring your message to a diverse audience. For example, when looking at Chainalysis’ 2023 Global Crypto Adoption Index, the top 10 countries in terms of crypto adoption come from all continents except Oceania (and Antarctica of course 😊). With this in mind, and crypto’s borderless nature, it is easy for crypto donors to give to nonprofits from anywhere in the world, amplifying your nonprofits potential impact and reach.
7. Crypto giving can be very cost effective
Traditional monetary systems can sometimes come with hefty transaction fees, including payment processing fees, credit card fees, platform costs, you name it. While there will certainly still be costs associated with accepting cryptocurrency donations, crypto transactions can be vastly more cost-effective, ensuring more of the donation goes directly to the cause, and less to intermediaries. Platforms like Endaoment and Angel Giving, for example, are free to sign up for nonprofits, with relatively low donor fees compared to traditional platforms. For those nonprofits that are more comfortable with Web3, they can also set up their own wallet and receive donations directly from anywhere in the world, without the need for traditional intermediaries and the costs that come with them.
8. It’s a foot in the door to the Web3 ecosystem
Those in the web3 space come from diverse backgrounds. They aren’t just coders or investors – they are community connectors, promoters, policy experts, artists, and more. Accepting crypto donations can get your foot in the door to this amazing and talented community. It can be step one in a journey to fully embracing Web3 and all its future use cases for your organization. Whether it’s reimagining how you engage with donors, delivering educational programming, providing humanitarian aid directly to those in need, or using NFTs to raise funds, the use cases are endless. By engaging with Web3 via crypto philanthropy, it can open your mind to new technologies and applications that can revolutionize the way your organization supports beneficiaries and delivers on its mission.
9. It’s easier than ever to accept cryptocurrency donations
One of the biggest barriers to nonprofits engaging with crypto is the perception that it is complicated, not user friendly, and is high risk. However, over the past few years, several crypto philanthropy platforms like Endaoment, The Giving Block, Giveth, Givepact, and Angel Giving have emerged, making it easier than ever to integrate crypto donations into your operations. These platforms make it easy to set up a wallet, start receiving donations, and convert your crypto donations to fiat, protecting your organization from the volatility of crypto and allowing you to deploy the funds immediately.
10. Crypto philanthropy will play a key role in the future of charitable giving
As digital currencies become more mainstream, crypto philanthropy will likely play an indispensable role in charitable giving. By engaging now, nonprofits are setting themselves up for success in this inevitable future. After all, if it’s truly a matter of if, not when crypto becomes a staple in charitable giving, it’s better for nonprofits to be early adopters, and experience all the benefits that come with that, rather than scrambling to play catch up in a few years.
Conclusion
While cryptocurrency may seem complex or daunting for many nonprofits, especially those that are smaller or lack a dedicated IT team, its potential benefits for the nonprofit sector are substantial. This Giving Season, consider diving into the exciting world of Web3 by embracing crypto philanthropy – your future self may thank you for it. Remember, in the fast-paced digital age, staying ahead of the curve isn't just an advantage; it's a necessity.
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The time is now to become a Crypto Charity and develop your Web3 strategy
To Nonprofits, it is understandable that Web3 can be overwhelming and intimidating, but we’re here to help. Through NextGen Nonprofit, our consulting arm, we offer personalized support to help your Nonprofit develop a comprehensive Web3 strategy. Whether it’s accepting cryptocurrency donations, developing a Web3 marketing strategy, or forming key partnerships, we’re here to make it a lot easier for your organization.
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