The founder of The Giving block states that cryptocurrency is the most benevolent investors for their help.
In 2021, cryptocurrency users were named the most generous investors in the world. For those outside of cryptocurrencies, this may not mean much, but after years of reading about the hypocritical attacks from the traditional financial sector, it is heart-warming enough to see the world admit that we are more generous than our critics.
Head to Twitter today and you'll find thousands of people tweeting about their crypto donations to charity. Type "#CryptoGivingTuesday" into the search bar and you will see hundreds of charities thanking millions of dollars for crypto and NFT projects to make our world more beautiful. The crypto community understands that these donors (let's call them die-hard crypto donors) – with their Twitter space, live streams, NFT breakups, and partnership news – are one of the most powerful forces behind crypto mass adoption, and have won millions of norms must-have. by smearing their crypto donation initiative on the internet.
But these noisy crypto donors are only part of the picture. Behind the scenes, private crypto donors are winning the silent war for donor privacy in the non-profit sector. As someone with a cryptocurrency platform, I want to tell you why this is so important.
Why is donor privacy important?
Prior to working in the cryptocurrency space, I was in the non-profit sector. I learned a lot about what moves donors. I also learned about a magical concept called "donor management", which uses donor data to encourage donors to donate more and more often. If you've never worked for a non-profit, you wouldn't know, but raising funds costs the organization a lot of time, energy, and money (and then the donors get mad about it and call it "overhead"...but don't get started). Donor assistance is important for non-profit organizations. It is easier to use data to target existing donors than to attract new donors, which means they spend less time and money raising funds. More than 1,000 non-profits I've worked with directly appear to be using this data ethically. Most collect it simply out of fear of unwittingly accepting ISIS donations (although expecting non-profits to catch ISIS with their donor forms is how you expect Starbucks baristas to snatch stolen credit cards in front of Visa).
- The non-profit industry has developed an interest in your data by collecting it and using "wealth screening" companies (which have become one of the fastest growing companies in the industry) to compare and contrast it with growing databases to determine how much money you should make.
- For nonprofits trying to raise funds effectively, this type of service is heaven sent to increase budgets and impact. Currently, most large charities do not accept anonymous gifts as usual. But if you're anything like me, you may not like the idea that the personal information you enter into a donation form ends up on the server farm to "instruct" you to be more generous, even when it comes to a big cause. Additionally, the ability to donate anonymously to charities allows donors to support important causes without fear of embarrassment or persecution. Which brings us to private crypto donors.
Implications of donor privacy in the real world
While interest in crypto philanthropy has grown this year, it has been around for years. Many of us remember the first big wave of crypto philanthropy during the 2017-18 bull market, when Ashton Kutcher donated crypto at the Ellen DeGeneres Show (when we loved it) and private donors started the Pineapple Fund, which started $55 million US dollars raising bitcoins for 60 charities ( The Pineapple Fund was our inspiration for starting The Giving Block). The private crypto donors behind the Pineapple Fund have encouraged dozens of non-profits to accept anonymous donations for the first time, many of whom have raised millions of dollars to transform their organizations.
I immediately discovered the importance of private crypto donors in person when the charity LBGTQ we support received their first major crypto gift. That's a lot of money, and the non-profit is baffled as to why one of their biggest donors doesn't want recognition for their gift. About a week later, we received a text message from the proton donor letter. He is a reclusive gay man, and because he fears bonding with him, he has never donated to LGBTQ charities before. I'm not ashamed to admit that I never thought of an experience like this when we started accepting gifts from private crypto donors. I just feel that donors deserve the opportunity to donate without being bothered by letters or jeopardizing their personal information. His story is the first of many.
Over the years donors have written to us after donors, thanking us for our anonymous opportunity because their stories opened our eyes to a range of human experiences that are often erased from the experience of philanthropy. These private crypto donors are the most passionate philanthropists I have ever met, from human rights activists fighting repressive regimes to women in Afghanistan who have never been able to get a male guardian to allow AFN donations from their bank accounts, women in Afghanistan cannot have their own bank account).
Fast forward to 2021 - Cryptocurrency prices have peaked and millions of crypto investors are hearing about the tax benefits of donating crypto for the first time. It has raised millions of dollars into the nonprofit sector from private crypto donors, including perhaps the most high-profile donation in the history of our platform.
In October, a donor anonymously pledged our pledge to provide cryptocurrency before donating $3.5 million over the air (ETH) to Lédecins Sans Frontires/Doctors Without Borders (MSF). The reason this donor requested anonymity isn't as emotional as in other cases, but again it's an interesting human experience. For the first time in their life, they are making money with cryptocurrency - a lot of money. So far they are living a quiet life and want to keep it. They don't want to risk sharing their identity with a non-profit whose marketing team could inadvertently throw their gifts into their social circles and tweet them, forever changing the way their friends and family treat them. They came to us, donated anonymously, wrote a beautiful letter to MSF that brought our team to tears, and then disappeared.
Starting in 2018, we will be sharing stories (anonymously) about these private crypto donors with the non-profits we serve. As a result, more than 90% of our non-profits ignore the anonymous option included in our widgets, even though any of them can disable it at any time. Crypto attracts non-profits to more than just blockchain – it gives them privacy as some of the biggest non-profit brands accept anonymous donations for the first time to capitalize on crypto trends.
Moral message in the story
While I understand the motivations of non-profits to need information about donors, I hope we continue to move toward normalizing donor confidentiality. While data collection is useful for lowering charitable fundraising costs, non-profits create unnecessary friction by forcing everyone to do it and weeding out very good people who deserve to support a big cause without compromising their right to sacrifice confidentiality.
If you are a noisy crypto donor building a huge charitable crypto initiative and shouting, thank you for serving as a crypto adoption warrior. If you are a private crypto donor, thank you for your generosity and role in protecting privacy in the nonprofit sector. And if you're a nonprofit that excludes anonymous donations in their gift-taking rules, I hope this article at least convinced you to keep an open mind.