Sample Technology Paper on Crypto-currency: Blockchain Charity

How Crypto-currency is helping Charity

Most of the growing concerns in digital currencies usually focus on financial gains and market growth. However, an exciting new trend that leverages the power of blockchains to facilitate philanthropic activities is currently on the radar. Today, several charitable or philanthropic institutions are accepting donations in the form of digital currencies. Some are even using digital tokens and the blockchain technology in innovative and powerful ways. These exciting new trends are capable of transforming and growing the philanthropic world.

 

Blockchain Charity

For the past few years, there are several foundations and charities that relied and are continuing to rely on bitcoin donations. These include renowned organizations such as the Electronic Frontier Foundation, the Wikimedia Foundation, United Way, Save the Children and the Red Cross. These organizations use a digital “wallet” for accepting cryptocurrencies such as bitcoin as charitable donations. The “wallet” also enables them to trade the cryptocurrencies in exchange for flat currencies such as the Euro or the dollar.

 

The charities usually pay zero percent of the donations as processing fees when using the digital wallets to accept donations or trade cryptocurrencies for flat currencies. This incentive enables the organizations to pocket 100 percent of the money that people or companies donate. It is important to note that bitcoin donations to charity have zero percent tax deductions. This incentive allows donors to give to charity donations without worrying about tax deductions.

 

The Pineapple Fund

A new concept, the “crypto-foundation”, is gaining critical acclaim in the cryptocurrency charity space. This concept came about when an anonymous bitcoin investor opened a foundation known as the Pineapple Fund to generously give away 5,057 bitcoins (valued at $86 million at the time) to charity. This bitcoin investor believed that money didn’t matter as long as one has a lot of it. Wealthy individuals and tech entrepreneurs are also following the investor’s footsteps by giving back to community foundations and funds.

 

Exciting New Opportunities

Thanks to the increase in the use of cryptocurrencies to make charitable donations, new charity revenue streams are emerging. One factor that facilitated the emergence of these revenue streams is the simplicity in direct-to-charity digital currency donations. It is also easy to monitor and manage these donations. Bitcoin is among the digital currencies that attract millennial givers in the charity space. There are predictions that before the year 2018 ends, one out of three millennials will own a digital currency.

 

Charity organizations can also improve their reputation through blockchain-based systems. Due to the recent decline in trust in nonprofits, blockchain technology may prove to restore the trust among the skeptical givers. Some people think that the charity organizations have a tendency of spending most of their money on selfish endeavors. Blockchain technology can help to show the donors the number of the donations made and how the organizations spend the money.

 

It is exciting to note that profitable blockchain companies are also giving a portion of their currencies and profits to charities. These companies realized that charities play a crucial role in the society. For every profit they make, they decided that a certain percentage of the profits will go to charity. This initiative aims at increasing the revenue streams of charity organizations.

 

Foundations and charities may produce their own digital currencies in the future as analysts predict. This step could help them create a new sustainable modal in charitable giving as far as blockchain technology goes. They may also come up with a charity token exchange developed mainly for selling and buying charity tokens. This model can foster an exciting new market-based approach in the charity world that allows charity organizations and philanthropies to constantly earn money from their trade of cryptocurrencies.

 

The Future of Crypto-philanthropy

In the near future, chances are that blockchain platforms and digital currencies will displace or disrupt traditional charity activities. These technologies may also drive more experimentation and innovation in the industry. Crypto-philanthropy will continue to grow as more nonprofits accept donations through cryptocurrencies such as bitcoin.

 

As specialized crypto funds formed by large charity funders such as Fidelity Charitable expand, they will facilitate the expansion and popularization of cryptocurrency donations. Smart contracts will also be instrumental in managing and tracking donations. All these innovations aim at establishing new standards for the philanthropy world.