Manage Cryptocurrency as Part of Your Church Assets
When considering cryptocurrencies such as bitcoin as part of your church’s digital assets, there are some important things to remember. In this article, we go over the key points to consider when accepting cryptocurrency donations. These tips are great for any church pastor, manager, or financial consultant of the church.
1. Consider This New Type of Donor and Their Needs
Investors from the crypto space who want to give to a charity may differ greatly from the kind of donors that your church is used to working with. They may also have different philosophies and ideas about the future of social infrastructures and even communities.
While most donors are more accustomed to traditional ways to donate, those in the cryptocurrency space may expect your church to be more digitally oriented. They will want tech solutions that work, are efficient, and make sense. So you must appeal to their passionate personalities and research the innovative solutions that they want to get behind.
2. Never Forget the Volatility of Cryptocurrency
Just as any investment is a risk, you must enter the cryptocurrency space with caution, wisdom, and guidance from others who have been there before. There are obvious benefits of receiving valuable assets that help your church reach its missions. Consulting with specialized brokers will help you understand this new technology, so you can make wiser financial decisions.
The value of crypto coins fluctuates by the hour, so knowing how to handle your expectations when accepting this kind of donation will help you manage the outcomes. At DonorWerx, we can give you tips on managing funds and pastor expectations on the donor journey.
3. Ensure Legal Provisions Are in Place
Accepting cryptocurrency donations gives you an opportunity to attract new donors to your cause. These may even be donors you would not have engaged with otherwise. However, remember that when you accept cryptocurrency donations, taxes may apply to your cryptocurrency asset growth.
Know what to expect when managing your church finances and annual tax reports. Nonprofit leaders must also expect that some donors will prefer to give crypto as anonymous gifts and wish to remain unknown. Without legal guidelines and provisions in place, your church finances may suffer.
4. Do Your Research
There is a lot to learn about accepting cryptocurrency, whether as payments or donations. In order to accept cryptocurrency donations, you must have a way to store digital coins. This is normally a digital wallet such as Coinbase.
Your church can create a Coinbase account or hire a vendor to help you manage the cryptocurrencies. That will let you have a digital wallet for all of your cryptocurrencies. From the digital wallet, you can then track your assets and monitor their value.
Research also means staying updated with cryptocurrency news and tracking market value. If this is too time-consuming for you as a pastor and church leader, you could consider outsourcing the work. Consider it the same way you may outsource or hire legal teams to take care of legalities for the church.
However, this does not mean that your pastors should stay in the dark about cryptocurrency. While they do not have to micro-manage everything, they can still educate themselves about these new kinds of assets and this new type of donor.
Part of the research your fundraising programs should include are:
- Educating yourself and your team on cryptocurrencies and how they work.
- Ensuring that your leadership is onboard with crypto donations and understands what it entails.
- Agree unitedly on the structure and processes of your cryptocurrency donations and assets.
- Learn to understand the unique characteristics of crypto donors, and appeal to them accordingly.
5. Protection of Privacy
Your church treasurers who are in charge of your assets in crypto or otherwise must understand that the need for protecting digital assets is now greater. Protecting your private keys is critical, as is protecting those who entrust you with their donations.
Always make sure your digital tools have the highest level of security so that no individual or organization is compromised. Learn all you can about cybersecurity and how this relates to managing your church’s financial goals. Get the software you need for secure online giving.
How DonorWerx Can Help
After you have researched the current crypto regulations that apply to your church and have consulted with a specialized broker, the next step in using cryptocurrency to grow your church assets is getting tech counsel.
At DonorWerx, we have worked with nonprofits and churches to ensure that their donor journeys are smooth and successful. To do this, we have created tools, programs, and resources that help educate and train pastors or church managers in fundraising and appealing to donors.
A digital technology advisor or partner like DonorWerx ensures that you have all the tools at your disposal. Call us today to find out how we can help you grow the church and manage your giving plans.