Cryptocurrency for Nonprofits: Basics and Overview
Learn how your nonprofit could benefit from cryptocurrency.
Every.org enables crypto support to over 1 million nonprofits already. If you’re a US-based 501(c)(3) public charity interested in using Every.org to help your supporters to give with crypto without having to deal with additional legal and accounting headaches, get started for free at every.org/crypto.
Otherwise, read on to equip yourself with the knowledge to accept cryptocurrency donations in this 3-part series for nonprofits.
Part 1: Basics and Overview
Part 2: Risks and Considerations
Part 3: Best Ways to Accept Cryptocurrency
What is cryptocurrency?
It’s, in a nutshell, digital money. The main difference is that the transactions are verified and recorded in a decentralized ledger such as a blockchain. The value of a coin is determined by market demand, and there are thousands of cryptocurrencies, some of the most popular including Bitcoin and Ethereum which are valued at thousands or tens of thousands of dollars per “coin”. Rather than being controlled or maintained by a central government or financial institution, cryptocurrency is instead maintained through smart contracts.
Why your nonprofit should care about cryptocurrency
Keeping up with the different ways your supporters want to give can be tough. Surging interest in cryptocurrencies especially has left many nonprofits feeling behind and intimidated by the technical challenges and legal uncertainties around accepting crypto donations.
Despite that, with cryptocurrency reaching over $2 trillion in market cap in 2021 and donors eager to support the organizations they care about in a tax-efficient way by giving crypto, nonprofits that take advantage of this new giving vehicle stand to gain a lot.
Who owns and donates cryptocurrency
Billions of dollars have been donated in cryptocurrency, and it's becoming more popular.
While crypto has been through boom (and bust) cycles before, the most recent gains are notable for being accompanied by activity and investment by names we all recognize: in February, Tesla announced a $1.5 billion purchase of Bitcoin. PayPal and Square have both launched features allowing their merchants to accept payment in crypto. Even traditionally conservative banks like BNY Mellon and Morgan Stanley have announced crypto investment products.
Gemini’s 2021 State of Crypto report estimated that 21 million or 14% of all US adults hold crypto, of which over 70% are relatively young at 25 to 44 years of age. 26% of crypto holders purchased their first crypto assets within the last year, and a remaining 66% of U.S. adults are crypto-curious, meaning they might invest in crypto soon. Forbes Magazine’s 2021 billionaires list included 12 people who made much of their fortunes in crypto, up from just 4 last year. Beyond billionaires, CBS estimates that there are over 100,000 Bitcoin millionaires.
All this means that the number of people holding significant wealth in cryptocurrency has grown tremendously and is likely to grow further, along with the donations they make. Hard numbers are still difficult to come by, but all time crypto giving was estimated at roughly $200 million in 2019, while 2021 alone has already seen billions in crypto donations.
On the nonprofit side, larger organizations like the American Red Cross, UNICEF, and Greenpeace are now all accepting crypto donations. Nonprofits that begin accepting crypto donations have often seen excitement from the crypto community, with GiveDirectly telling Vox’s Future Perfect that crypto “contribute[d] significantly to their rising donation levels,” helping take them from 100 to 300 million dollars raised in 2020.
On Every.org, the average crypto donation is 240x larger than credit card or bank donations.
Why donors want to donate cryptocurrency
For those people who hold appreciated crypto, donating that crypto can be an attractive way to support the nonprofits they care about. Donating crypto is a nontaxable event. The IRS currently treats crypto donations similarly to stock in that donors will not recognize capital gains on the donation and may be able to deduct the fair market value of their donated crypto on their taxes, leaving them able to make donations much larger than they would have otherwise.
How to easily accept cryptocurrency donations
Every.org makes it easy to receive support in cryptocurrency through our donation platform without having to worry about the legal, accounting, and technology.
As a nonprofit for nonprofits, Every.org handles the entire process of accepting donations in Bitcoin, Ethereum, and other top cryptos, sending a receipt to the donor, and converting it to cash without charging nonprofits a single cent. Your organization never has to handle the crypto, receiving the full realized value as a cash grant.
Nonprofits can easily add a free-to-use button for accepting crypto donations to their own website without having to talk to an expensive lawyer, accountant, or technical expert. Adding a donate crypto button to your website is free, easy (takes less than 5 minutes), and lets donors know that they can support your organization with crypto, opening your organization up to one of the most exciting and untapped donor markets out there. Get started at every.org/crypto.
Empowerment for every nonprofit
Every.org is a tech nonprofit founded to connect nonprofits and their supporters through a joyful, seamless giving experience. It makes it easy for donors to support with any giving vehicle— including PayPal, stocks, DAF, and now crypto.
Funded by philanthropists who believe in empowering the entire nonprofit sector with technology, Every.org takes no cut of any donations made. The tools we build are free for nonprofits.
An important part of our mission is providing nonprofits free access to the latest and greatest fundraising technology, making expanding our platform and tools to enable the entire sector to participate in the crypto space a natural extension of our work.
If you’re interested in using Every.org to enable your supporters to give with crypto, check out every.org/crypto or get in touch by emailing nonprofits@every.org.
If your organization is interested in directly receiving cryptocurrency, read Part 2 to learn more about the considerations you may want to make as an organization before doing so.
Next: Risks and Considerations →
Disclaimer: These posts are for informational purposes only and not intended as legal or financial advice. Please consult a professional for the latest and most accurate information. We make no representations or warranties as to the accuracy or timeliness of the information contained herein.