Indeed, technology Blockchain And the world of cryptocurrencies are usually associated with the investment sector, either to benefit individuals or companies. However, adding to its financial nature, the Blockchain platform has proven to be very useful when it comes to helping those most in need through donations. But can Blockchain technology really drive philanthropy?
Cryptocurrencies and Blockchain have been useful in charity
In recent years, various non-governmental organizations (NGOs) and non-profit foundations have been implementing crypto donations. Among them are organizations such as the Italian Red Cross, The Water Project and Save the Children.
In April this year, for example, the Red Cross in Italy managed to raise around $ 32,000 in cryptocurrencies in less than a month in order to build an emergency medical post for COVID-19 patients.
Although some studies on the use of Bitcoin in charity reflect that crypto donations represent between 1% (in Latin America) and 5% (in the US) of payment methods, initiatives such as that of the Red Cross Italian demonstrate that cryptocurrencies are slowly gaining ground in non-profit foundations. Some even refer to this combination as “crypto philanthropy.”
Why is Blockchain being used in philanthropy?
Simple: Blockchain has many benefits. One of them (and the main one) is that Blockchain technology provides NGOs with a reduction in costs thanks to the lack of intermediaries.
Donations are currently managed by intermediaries, such as banks. These are in charge of processing the funds so that the donations reach their destination in exchange for a certain fee. Through a decentralized Blockchain there are no intermediaries, therefore, in most cases the fees disappear.
Furthermore, donations can be seen and tracked by anyone, since Blockchain has the quality of being transparent. In this way, donors have the security of being able to follow the path and destination of their funds within crypto philanthropy.
Even Chinese e-commerce giant Alibaba created, in 2016, a tool for charity on Blockchain called Ant Love. The system connects Alibaba’s 450 million users with more than 1,000 charities to help track donation histories. This helps donors understand exactly how their money is used.
Various initiatives and NGOs benefit from crypto philanthropy
Of course, charities must put in place an efficient fund management process before starting to receive donations in crypto. If you want to implement the system correctly, you first need to understand the fundamentals of cryptocurrencies and Blockchain technology.
There are a growing number of companies that are joining crypto philanthropy, making it easier to use. For example, Paxful’s #BuiltWithBitcoin initiative is on a mission to build 100 schools with Bitcoin donations. You have already completed three.
There is also BitGive, an initiative that has participated in a variety of projects such as Save the Children in the Philippines and West Africa and The Water Project in Kenya. This platform has been in operation for more than 7 years, and has more projects in Argentina, Ukraine, Ethiopia and Venezuela. All of them, of course, based on cryptocurrencies and Blockchain technology.
As well as organizations, altcoins have been created specifically for philanthropy. Among them is Clean Water Coin (WATER), each transaction made with this crypto will donate 0.1% to the distribution of drinking water in the most needy communities. In addition, as an NGO, Clean Water Coin also accepts donations in Bitcoin and Litecoin on its website.
Blockchain can indeed boost philanthropy
Blockchain is a very versatile platform with different applications, which has given us both financial freedom and humanitarian benefits. By further incorporating Blockchain technology and crypto donations in the philanthropy sector, we will see notable improvements in it. Due to its transparency, it may even help combat corruption that has been seen in some NGOs.
Furthermore, many people believe that crypto philanthropy can provide faster financial support to victims of various tragedies or natural disasters.
From startups designing programs that facilitate cryptocurrency donation, to organizations creating altcoins to help their causes, we can conclude the future of philanthropy in Blockchain technology is bright.
And you, do you think that Blockchain technology can boost philanthropy? Or do you prefer to stick with traditional donation methods? We await your opinion in the comment box.