Are you interested in knowing how to accept crypto donations? That’s great, because charitable groups may gain from accepting cryptocurrency donations as the cryptocurrency market expands. This blog post will go over the advantages of taking cryptocurrency donations, give some examples of charities that accept donations in cryptocurrency, and how to set up this way of payment.
- Accepting cryptocurrency donations for nonprofit organizations
- What are the benefits of accepting cryptocurrency as a nonprofit?
- Are there a lot of people donating via cryptocurrency now?
- What payment processors can handle Bitcoin donations for nonprofits?
- Setting up to accept donations in cryptocurrency for nonprofits
- Who accepts cryptocurrency donations?
- FAQ: Accept Crypto Donations in 2023
Accepting cryptocurrency donations for nonprofit organizations
Now let’s talk about the benefits crypto gives when donating, who does it, and which payment processors can work with your idea.
What are the benefits of accepting cryptocurrency as a nonprofit?
- The first and most important reason why donors are switching to cryptocurrency transactions is tax benefits. According to the IRS’s most recent modifications, cryptocurrency is regarded as a sort of property. The donor is typically excluded from capital gains tax on appreciated assets when they donate to a 501(c)3 organization.
- Cryptocurrency donations to charities allow its holders to expand its use and appeal. Fundraising for nonprofits has the potential to be widely publicized. Additionally, any financial technology employed by organizations typically attracts a lot of attention. Therefore, it’s a means for current holders to expand their market as well.
- Donations made using cryptocurrencies are also exceptionally quick and convenient. All it takes is a few clicks, and a few choices, and a widget will do the rest. It takes fewer steps than other methods of donation, such as cash or credit cards.
- Many cryptocurrencies increase in value over time, so accepting them as donations can lead to an increase in funds long term.
- More people are looking to donate with cryptocurrencies, so ensuring that it is an option will attract and retain donors.
- There are still options for anonymous giving, which broadens the donor pool for different causes. With the public ledger, there is accountability for the money movement, but it is not always connected to individual identification.
Are there a lot of people donating via cryptocurrency now?
There are huge charity groups already leaping cryptocurrencies. For example, Fidelity Charitable is classified as a public charity under IRC section 501(c)3. The patterns in cryptocurrency donations over the previous few years are shown in their yearly report.
FC started accepting crypto in 2015. In the first year alone, they received gifts totaling roughly $7 million. The majority of these proceeds were in Bitcoin. Additionally, most other cryptocurrencies hadn’t really taken off by that time. They collected nearly $69 million in just 2017 alone.
The success of charities accepting Bitcoin, like FC, illustrates that it is undoubtedly changing the game for those who said charities couldn’t succeed with crypto. In fact, asset appreciation is rarely as good as it has been with Bitcoin and other major coins. Other cryptocurrencies also have had strong growths in value over time, even despite short-term dips.
What payment processors can handle Bitcoin donations for nonprofits?
For the majority of nonprofit fundraising, a payment processor is without a doubt the best option. You benefit from quick and easy donation acceptance methods. More crucially, though, these platforms can buy, store, and/or sell your cryptocurrency on your behalf. Consequently, they let you accept Bitcoin (or other cryptos) and get it converted to fiat money swiftly and safely (for example, USD or CAD).
These processors work with crypto for non-profits:
- Engiven charges a flat 4% fee for converting crypto into fiat
- The Giving Block has an easy-to-use donation widget
- Bitpay has free and easy integration and a non-custodial wallet
- Every.org doesn’t take a cut of any donation and there are no fees for their intermediary service.
Setting up to accept donations in cryptocurrency for nonprofits
Setting up a crypto wallet or an account with a third-party cryptocurrency payment processor, as we covered in a previous chapter, is one way to receive donations of digital assets. You can hold cryptocurrencies on these services and convert them into fiat, for example, USD. Beyond the scope of this blog, setting up a private hardware wallet entails particular risks and advantages. For the majority of firms, however, creating an account on a third-party platform is a quick and easy process.
The next step is to add a contribution link and a form to your website after you have an account that can accept incoming cryptocurrency. Consider forcing donors to fill out a form with their personal information in order to prevent anonymous gifts, which can be challenging to track down and manage. Additionally, gathering this data can help in giving donors year-end tax receipts.
Who accepts cryptocurrency donations?
Currently, there are many non-profit organizations that already take crypto as a form of payment. They are represented on BitcoinWide in categories such as “Non-profit organizations”.
Here are some examples:
- Action for Solidarity
- Art in All of Us
- Against Malaria Foundation
- Dolphin Project
- Alex’s Lemonade Stand
- BCM Georgia
- Ronald McDonald House
- Direct Relief
- Central Texas Food Bank
- Heifer International
- Unchain Fund
- War victims Fund
- Happy Hearts Indonesia
- The Water Project
- Built with Bitcoin
- Save the Chilrden
- Ukraine Razom
For many people over the past few years, cryptocurrency has been a rapidly expanding asset class that has led to wealth creation. If organizations accept crypto donations, they may increase their fundraising efforts and gain access to a growing group of crypto-wealthy people who wish to give with their appreciated digital assets. There are substantial dangers and opportunities, just as with any new asset class, and being open to them now could pay you later.
FAQ: Accept Crypto Donations in 2023
How do I accept crypto donations?
There are ways to set up a legal account that is connected to the nonprofit if it wants to make a significant commitment to cryptocurrency donations. Donation solutions are offered by organizations like BitPay, Engiven, and The Giving Block, enabling nonprofits to accept cryptocurrency donations.
How do I accept donations on Coinbase?
If your organization wants to accept cryptocurrencies, you can create a Coinbase Commerce account and start accepting donations in different digital currencies, such as BTC (Bitcoin), ETH (Ethereum), stablecoins USDC, USDT, as well as APE, BCH, DAI, DOGE, LTC, and SHIB.
How do I create a crypto donation link?
It depends on what payment processor you chose for accepting donations in crypto. If it’s the Giving Block, you can fill in a form on their website, stating information about you and your non-profit organization, and book a demo of how it works.
Are crypto donations tax-deductible?
The fair market value of the contributed crypto will be deducted from your taxes as your tax credit (as determined by a qualified appraisal). Your cryptocurrency donation is tax-smart because the 501(c)(3) charity will receive the entire amount of your gift without having to pay capital gains taxes on the appreciation.
Where can I get a crypto donation?
There are several crypto donation solutions available on the market nowadays, one of them can be The Giving Block. It offers an ecosystem for nonprofits and charities to fundraise crypto, be found by cryptocurrency donors, receive funds instantly, and join a network of crypto media partners to support their missions.
Can nonprofits accept Bitcoin?
You can accept bitcoin donations for your organization through another 501(c)(3), like a donor-advised fund (DAF), without having to keep any of the cryptocurrency in your possession. With the exception of confirming your status, all 501(c)(3) public charities are typically immediately qualified for this type of donation, which enables you to accept financial grants without having to comply with new accounting or tax filing requirements.