The Season of Giving
The holiday season brings the most charitable donations of any time of the year. With the trio of Thanksgiving, Giving Tuesday, and Christmas—along with last-minute donations to tap into tax incentives before the New Year—every organization takes some time out to prepare itself. This year, though, there’s a new topic making headlines: Nonprofits and cryptocurrency donations. Here’s what you should know.
Nonprofits and Cryptocurrency
The topic of nonprofits and cryptocurrency really isn’t anything new, though it has gained a lot more attention in recent years. In truth, United Way was one of the first large organizations to explore the benefits of merging nonprofits and cryptocurrency when it began accepting Bitcoin donations back in 2014.
At the time, a Bitcoin was worth $770 and it had very little competition. The topic of cryptocurrency was just beginning to be widely understood and it was only then becoming more accessible to the masses as user-friendly wallet software continued taking off. Today, a single Bitcoin is worth 55x more, with a value of $43,000. Needless to say, United Way continues to talk positively about accepting crypto.
Almost eight years down the road, nonprofits and cryptocurrency have come a long way. Now, countless charities accept crypto donations, and recent innovations, like The Giving Block, are making it easier than ever before. So, here’s what you need to know to get ready for this holiday season.
Crypto Is Less Complicated Than You Think
The biggest mistake most nonprofits make when thinking about crypto is comparing it to the dollar. If you continue to do so, you’re going to miss out on its biggest benefits. Instead of looking at cryptocurrency as an alternative to the dollar, consider it an asset class. Crypto is taxed much like stocks, and it should be treated in a similar manner, too.
When it comes to nonprofits and cryptocurrency, the simplest way to approach crypto donations is to have a means of holding them. Building a portfolio of crypto can position your organization for unprecedented growth–even if it’s not the 55x gains that United Way has seen on some of the first Bitcoins they received, it still has major potential.
Of course, because crypto shouldn’t be seen as something you immediately cash out on, it’s important that you offer multiple cash-giving options. We can help you set up kiosk, online, and text giving so that you have plenty of capital flowing in, and we can guide your holiday fundraising campaigns.
The Necessary Tech is Highly Accessible
As cryptocurrency has become more mainstream, many companies have stepped up to make the tech side of crypto simple to understand, even for non-tech users. As a nonprofit, you can easily get going with accepting crypto donations by turning to a provider like The Giving Block. They specialize in nonprofits and cryptocurrency and they offer a seamless way to add a crypto donation form into your website.
You can also turn to the experts here at DonorWERX to help guide your donation strategy. As coaches and consultants, as well as software providers, we’ve helped countless organizations navigate this new space and decide how to work crypto into their long-term plans. With our help, accepting crypto will prove simple, and you can make sure you’re doing it in a way that aligns with your long-term goals.
With a combination of software from DonorWERX to handle your donor engagement, online, text, and in-person giving, and a crypto donation provider plugged in, you’ll have a seamless solution for accepting donations in any way your donors wish to give.
Accepting Crypto Can Lead to 20% Higher Donations
Allowing your donors to give crypto can increase the value of donations you receive before you even realize gains. This is because crypto donations are tax-deductible for the appreciated value of the coin. Meanwhile, if a donor were to sell their crypto and donate its dollar value, they would have to pay capital gains tax on their earnings, which can cost them up to 20%.
When it comes to the tax implications for your organization, crypto donations probably won’t be nearly the headache you think they’ll be, especially if you plan to hold them instead of immediately selling them off. As long as you’re keeping crypto as crypto, you won’t owe any taxes and there’s nothing to report.
Crypto Can Future-Proof Your Organization
Nonprofits and cryptocurrency aren’t mutually exclusive. In other words, you aren’t required to accept crypto donations, but they are becoming more standard. Setting yourself up to accept crypto now can position your organization for sustainable growth. Basically, it’s becoming less of a “can do” and more of a “need to do” by the day, just like we witness as we led organizations in adopting online giving.
In response to this notion, some organizations might ask, “Why do it now when it’s still not standard?” The answer is simple: The sooner you start accepting crypto, the more gains you can realize. Had United Way waited until 2020, their Bitcoin gains would have been just 6x instead of 55x. That’s still great, but it shows that most crypto is a long-term play.
Aside from giving your crypto more time to realize gains, getting in early also enables your organization to tap into the lively and passionate community of crypto users. Right now, the number of organizations that users can donate crypto to is still very limited, so getting on the list can give your charity some well-deserved attention.
In the long run, adding a crypto donation option now is generally viewed as a smart move. Whether you already have donors who are interested in giving you crypto or you’re hoping to expand your reach to that community, the positive relationship between nonprofits and cryptocurrency is undeniable, and the future is bright.
How DonorWERX Can Help
If you’re thinking about the benefits of nonprofits and cryptocurrency, you’re not alone. In response to increasing demand, tech companies are making it easier than ever to implement crypto donations on websites, but that’s just one aspect of your strategy. If you need help aligning your organization with a long-term plan, DonorWERX can help.
With our advanced donation software and engagement coaching programs, we’ll work with your organization to set you up for long-term success. We believe that crypto donations will play an increasingly important role for nonprofits in the coming years, but we also recognize that today’s organizations have big shoes to fill in other areas.
Whether you feel like you’re ready to add crypto to your list of donation methods, or you’re still trying to navigate the ins and outs of online and text giving alongside digital engagement, we can help you move forward. Our proven strategies have allowed countless churches and nonprofits to conquer tech innovations while reaching new highs, and we’re excited to walk with you on the path to sustainable growth whether or not that involves combining nonprofits and cryptocurrency.
Ready to take the next step? Schedule a consultation today.