The new crypto millions in town have decided to donate some coins to charity organization after the latter started accepting donations in crypto.
Although the coins will be beneficial in helping these organizations run their projects are exposed to risks that come with volatility nature of crypto. But besides just supporting nonprofit organization the donors are eligible to get tax deductions from their actions according to the US tax legislation. In addition to the tax deductions, they get bonuses and don’t have to pay the government capital gains made from their digital assets. Also as the number of the millionaires rose it means many people are just holding onto their massive gains loot. But now the gains are acting as their motivating to instead send digital currency to nonprofit organizations than writing cheques after converting crypto to fiat currency.
Nonprofit Organization with a Significant Amount of Crypto
Through cryptocurrency millionaires feeling philanthropic several charity organizations are now in possession of huge chunks of crypto. According to a report published by the International Business Times in the leading front is Silicon Valley Community Foundation. The foundation task is it pull together a group of donors with various charities and raise funds. From its annual financial report, we gather that the Foundation is sitting on $4.5 billion worth of cryptocurrency in different currencies including Ether and Bitcoin. Besides SVCF the number one US charity organization based on donations Fidelity Charitable is also accepting cryptocurrency. And in 2017 it received quite a considerable amount of contributions in virtual currency.
Beside the above foundation, other smaller charities are joining the leagues of accepting crypto as donations for their projects. Furthermore, some charities are exclusively accepting crypto as donations.
Other ways of Raising Funds
Instead of requesting donations from people other charity organizations are taking a different approach of allowing users to mine crypto. One such foundation is Unicef Australia which enables users to mine Monero on its homepage. Revenue generated goes to fund its projects. In the same fashion, Change.org comes up with a screensaver that mines cryptocurrency when their computers are not in use.
As the number of donations in digital currency keeps raising so does the risks that come with market crashes rise. In 2017 many foundations got significant amounts of contributions in virtual currency. But without the knowledge of converting virtual currency into fiat, they ended up losing more money during the 2018 market crash.
Moreover, according to the report released by the International Business Times, the charities are exposed to the same risks as investors in the digital world. Furthermore, since they release financial reports annually the magnitude of loses caused by market crashes such as the 2018 one is unknown.