“Cryptocurrency is now becoming another item in the world that holds value, and people hold it and want to donate it and want to use it as a form of exchanging value…” - David Mitchell
In this episode Veronica Bamford-Deane speaks to David Mitchell about crypto-fundraising. They talk about the definitions of cryptocurrency, blockchain and NFTs, some of the opportunities this provides for charities, and what charities need to consider before accepting and promoting crypto fundraising to their audience.
What is cryptocurrency, blockchain and NFTs?
With the rise of interest in crypto currencies during the Covid pandemic and the growing challenges to traditional forms of fundraising. Now might be the right time for some charities to consider looking into these new digital forms of giving.
David talked about cryptocurrency being a decentralised form of finance which is distributed among the general populous without any one person, company or nation controlling it. A digital asset that can be traded among people and has a cash value, which charities can support their work. Blockchain is an alternative to a bank’s database, which everyone can see and everyone has visibility of, though there is also a level of anonymity for those making the transactions.
NFTs – Non-fungible tokens, are mainly used for digital artwork at the moment. They use the blockchain to track who has ownership of a particular item. David used the comparison of trading cards, such as football stickers, which were swapped in the playground in our youth.
What should charities consider before bringing cryptocurrency into their fundraising strategy?
Before a charity gets involved in raising funds and receiving cryptocurrencies they should have a discussion about the environmental impact. The online infrastructure of cryptocurrencies require a lot of energy and while some have recently reduced their carbon footprint there is still a long way to go before carbon neutrality. That being said, charities should be thinking about other forms of giving in this way too, as with investments and pensions and what secondary consequences the money flowing through their organisation is having.
The issue of donor anonymity and thresholds for gift acceptance was raised by David as a possible concern for charities. Like all fundraising this needs to be aligned and understood in the context of the charity’s risk assessment process and as part of their ethical fundraising policy and measured against the Code of fundraising practice.
In terms of how to then go about benefiting from cryptocurrencies. David suggested organisations and individuals learn about this new world by considering buying a small amount of cryptocurrency themselves and seeing first-hand how it works. David talked about the benefit of spending time understanding cryptocurrency and being proactive at outreach to companies and other entities rather than just making sure your charity is geared up to accept Cryptocurrency donations. Much like other forms of fundraising, charities cannot sit back and expect donations to come in without actively communicating about it and reaching out to those who might be able and willing to provide this support.
Technology developments and reason to hope
David talked about the Metaverse and virtual spaces and the increasing opportunity this will give charities to tell their stories in an exciting way and engage more support.
David also talked about gaming and streaming and how this is already providing charities with the chance of reaching out to a growing number of gamers and streamers across the world and raising significant funds from them.
This episode of Charity Chat has been brought to you by our platinum sponsor Work for Good. Work for Good is a fundraising platform helping businesses raise funds for charities through their sales. The platform makes the legal agreement needed for businesses to sales
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We hope you enjoy this week’s episode.
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