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Non-Fungible Tokens (NFTs), Decentralized Autonomous Organizations (DAOs), and Decentralized Finance (DeFi) are redefining the way charities collect donations and distribute funds to those who need it most.

Thanks to ever-evolving technology related to crypto and blockchain, crypto philanthropists told Cointelegraph that they have witnessed “new wealth distribution mechanisms” never seen before.

“Philanthropy has always been seen as an individualistic high-entry cost activity, but with web3, collective decision-making bodies like DAOs can use tools that streamline financial coordination and encourage greater participation,” Omar explained. Antila, product manager at Crypto. out of charity.

“Crypto enables new and innovative fundraising strategies, like NFT-drop charity campaigns, or allowing people to pool their crypto funds into decentralized finance (DeFi) protocols that earn interest for a specific cause,” said he added.

In October, a number of organizations focused on breast cancer began implementing NFTs to celebrate Breast Cancer Awareness Month.

Antila noted that he saw many other philanthropic communities built around non-fungible tokens (NFT), which have supported many other causes in need, such as testicular cancer, human trafficking and the war in Ukraine.

Last year, UkraineDAO, a decentralized autonomous organization, funded $6.1 million for a 1/1 Ukrainian flag non-fungible token (NFT). Proceeds were directed to non-profit organizations in Ukraine helping those affected by the Russian invasion.

Blockchain technology is poised to expand what is currently possible in the nonprofit sector. Source: Moralis.io.

Meanwhile Anne Connelly, co-author of “Bitcoin and the Future of Fundraising” thinks the crypto charitable sector will soon expand from Bitcoin (BTC) and ether (ETH) as the main cryptocurrencies for donations:

“Over time, however, we will see organizations accepting more token spread – the same way they would accept securities donations. We will also see donations of NFTs and other tokenized assets like real estate or collectibles.

“I believe that once […] as more organizations realize the philanthropic potential of this donor segment, every organization will have a crypto donation platform, similar to how every organization accepts credit cards,” she added.

Antila said the expansive nature of crypto means the total addressable market for crypto charity is also huge.

Antila believes that “the approximately 2 billion unbanked adults who exist in the world today” will soon have the tools “to participate in the global economy, transact and create wealth without third parties getting in the way or take a part”.

Related: Charities risk losing a generation of donors if they don’t accept crypto

More and more people and small businesses in underdeveloped countries are using Bitcoin and crypto for payments. Source: Cointelegraph.

This could be especially true for countries suffering from a lack of trust in their state’s monetary system, where crypto adoption rates are also the highest.

Connelly said adoption rates are highest in underdeveloped countries — including Nigeria, Argentina, Vietnam and South Africa — because they simply can’t trust the system. currency of their State:

“More than half of the world’s population lives under double, triple or quadruple inflation rates. For most people, they cannot trust their governments to effectively manage the monetary system.

“Having the choice to use crypto is an important option for citizens, but also shows governments that if they want people to use their fiat currency, they will have to clean up their act,” she added.