Why Are Donors Giving Bitcoin? They’re Not Just for Bitcoiners
Today, one Bitcoin is worth $12,000. What does that mean? Why does that matter? Here is why more donors are going to be giving Bitcoin this season.
Donors Give Best-Performing Assets to Charities
In 2010, one Bitcoin was worth $0.06. In 2014, $490. In 2018, $6,000. Today, one Bitcoin is worth $12,000. The exponential appreciation of this asset class means that millions of Americans each year get a better deal on their tax bill when they donate crypto rather than stocks or cash. The more a property asset appreciates, the larger the capital gains tax burden you are able to offset when you donate that asset.
Young People Don’t Donate Stocks. They Donate Bitcoin.
It should come as no surprise to you that almost none of your donors are giving stocks — especially the younger ones. The donation of appreciated property has long been a practice reserved for the wealthy, left on the shelf by the average American. Over the last decade, cryptocurrency has begun to change this trend, led by Millennial and Gen Z donors who are giving cryptocurrency to nonprofits to offset the capital gains tax burden. Now, half of Millennials trust cryptocurrency exchanges more than the U.S. stock market, a trend that is accelerating.
Nonprofits Are Asking for It
Bitcoin fundraising used to be a sort of happy accident. I remember fondly the Pineapple Fund days where one crypto donor came out of nowhere and donated $56 million to 60 nonprofits on a whim. This was the same year that Ashton Kutcher showed up on Ellen and donated $4 million in XRP to the Ellen Degeneres Wildlife Fund (maybe this one doesn’t age as well). Now, nonprofits are actively fundraising crypto. Following the blast in Beirut, the International Medical Corps launched #BitcoinforBeirut, a cryptocurrency fundraiser that captured the attention of YAP Global, Blockchair and other stakeholders in the cryptocurrency community. We saw the same occur around the U.S. civil rights movement and COVID-19 fundraising. Expect to see more, as nonprofits compete for real estate.
To recap, Bitcoin is up 72% since January 1, making it the most useful property asset for millions of donors to give to charity. The number of users continues to rise, led by the overwhelming popularity in the Millennial and Gen Z investor communities. Combine these two variables with the compounding fact that more nonprofits than ever are in their ear to give, I expect to see a dramatic increase in crypto donations this year-end, for Bitcoin Tuesday (#GivingTuesday) and beyond.
Pat Duffy, co-founder of The Giving Block, began as a federal consultant for pharmaceutical companies, focused on collaboration with nonprofits. He then shifted to the nonprofit sector, focusing on executive leadership and fundraising for voluntary health associations. Merging his nonprofit experience and passion for Bitcoin trading, The Giving Block was born, creating the turnkey solution for cryptocurrency donations now used by charities around the world.