Crypto for good: Explore the Blockchain Charity Space
When you think of crypto, you probably think of gains and making profits. And there’s nothing wrong with creating a nice stream of passive income for yourself and earning money with your investment. But nowadays, crypto can be used for so much more. Did you know that crypto can even be donated and used to give back to those in need?
A number of blockchain companies have taken up this cause and created tools for easy crypto donations and easier ways to find charities accepting crypto payments. Some even donate a percentage of the proceeds raised via their platforms directly to charity projects.
After reading this article, you’ll know all about how to donate crypto to charity and what this implies for your taxes. You’ll also learn about several donation services and crypto charities for you to consider supporting.
How to donate crypto to charity:
There are many ways to give crypto to charities. You could send crypto directly from your wallet to a beneficiary; or buy crypto using fiat money – either by converting cash into crypto or crypto into cash – then transfer them directly; or use an exchange service to facilitate a direct transfer between wallets.
Not all charities accept cryptocurrency as a donation. Yet there are many which actually see crypto donations as a benefit over regular fiat currency, hoping that the value will increase over time.
Why donate with crypto instead of traditional money?
Donating crypto might seem complicated compared to donating traditional money. But a benefit of donating crypto is that it allows donors to remain anonymous. This helps those in vulnerable positions maintain their privacy and anonymity while still getting assistance. In addition, unlike government aid, cryptocurrencies don't usually come with strict conditions attached. Since digital currencies aren't tied up in bureaucratic red tape like traditional funds, they're generally quicker and more efficient to distribute. Finally, because of its transparency and traceability, it can also help prevent corruption.
Is donating crypto difficult?
Donating crypto doesn't require any special training. Anyone who owns crypto should have no trouble sending some off to a cause they believe in. There's even a range of tools available for easy transfers between wallets. How much you give and how often depends on personal circumstances. But if you have a little spare change to donate after you've bought your groceries or used some crypto to fund your travels, you can also consider donating some.
Are crypto donations tax deductible?
Donating crypto is not only beneficial for those who receive it, but also comes with a benefit for you. Yes! Donating crypto is one of many forms of charity that are eligible for a federal income tax deduction. Check out IRS Form 8283: Noncash Charitable Contributions.
Donations to charitable organizations usually result in no taxes being owed, since any gains are not recognized until they're cashed out into fiat currency (unless donated through a trust). The donation doesn't count as profit and therefore can't generate taxes, which means donating to charities is considered a "deductible expense." This also means that when it's time to cash out, the donor will receive their fair market value in the form of fiat currency.
Since there are some instances where the tax treatment of cryptocurrencies is ambiguous, there are still some uncertainties surrounding how much of an impact these donations would actually make on your tax burden. Keep in mind that crypto-specific laws and regulations do change frequently, so check with a trusted accountant for guidance.
Charity Bots at BOTS
At BOTS, there are multiple bots which can trade cryptocurrency for you and help you net profits from your investment, and with the additional benefit of donating some percentage of your earnings to a charity of your choice. We proudly present three Charity Bots,each of them contributing to make the world a better place.
- The Bee bot will donate a quarter of your earnings and donate it to BeeLife, an organization that helps bees and the environment.
- The Tree bot will also match a quarter of your earnings but donate it to #TeamTrees, which helps plant trees for carbon offsetting.
- The Sea bot will give a quarter of your earnings to donate to The Ocean Cleanup, a foundation dedicated to removing plastic waste from the ocean.
Other donation services and charities
Interested in more ways to donate crypto? We’ve compiled a list of worthwhile donation services and charities that accept cryptocurrency. If you're interested in donating some of your crypto assets to charity, check out these platforms:
- BitGive Foundation:
The BitGive Foundation supports charities around the world through blockchain technology, allowing them to receive donations in cryptocurrencies.
- Blockchain For Good:
This initiative has helped create several charity initiatives to benefit underprivileged children in India.
- Donate Bitcoin Canada:
Donate BTC to Canadian Charities or Schools.
- BitHope: This crowdfunding site allows users to donate in BTC and BCH to non-profit organizations that help people in need worldwide.
A platform for buyers and sellers of goods to buy/sell products using crypto and then use it for charitable causes.
This blog is for educational purposes only. The information we offer does not constitute investment advice. Please always do your own research before investing.
Any views expressed in this blog and by BOTS do not constitute a recommendation that any particular cryptocurrency (or cryptocurrency token/asset/index), portfolio of cryptocurrencies, transaction, or investment strategy is suitable for any specific person.