Overview & Objectives
During June and July, BlockchainBH ran a campaign to raise donations in cryptocurrency in order to help the homeless people of Belo Horizonte. The goal was to receive bitcoins (BTC) and ether (ETH), which would be transformed into Brazilian Reais (BRL) to be used for buying blankets for the homeless.
Our reasons for using cryptocurrency were three-fold, and disclosed below:
With all the controversy surrounding cryptocurrency, one thing remains certain: it definitely facilitates money transfers across borders. As proof of this, you can check the ‘The campaign by the numbers’ section below.
Since we did not want to keep the campaign local, and wanted to show that it is possible for regular people to run a global fundraiser with little hassle and no third-party help, we chose to use Bitcoin and Ether, the two most widely used cryptocurrencies. All the material on the campaign was provided in both English and Portuguese, and donations were received from different parts of Brazil and the world. Check out below an example of just how powerful it is to be able to work across borders with little friction.
When donating to charities, most times we cannot be sure of the amount campaigns actually raise, and must trust the charity itself when it reports the total amount of funds received. Of course, there are auditing processes that increase our trust in organizations, but corruption schemes ran by charities still do happen.
With BTC and ETH that is not a problem. Anyone can easily verify all the transactions in and out of the donation addresses, be sure of the total amount donated, when and where the coins go somewhere else, and also check that BlockchainBH put in the amount it said it would. To facilitate this verification, we created a tutorial explaining step-by-step how to check all that was mentioned above, in two external websites used daily by thousands of people to verify data on transactions.
Proof of Concept
Lastly, we wanted to show that cryptocurrency/blockchain is not out of reach for regular users, that it is not something that only hackers use and that although it is based on a technology still in its infancy, it still has many benefits. And we’re surely not the only ones who believe that. Soon after the launch of our campaign, Coinbase, one of the largest players in the crypto space worldwide, released a charity fund that will use cryptocurrency to help those in need.
Additionally, for the reasons mentioned above, we also wanted to encourage people to use cryptocurrency for the first time, so we created another tutorial teaching people how to easily buy and transact with BTC and ETH.
Execution & Transparency Report
All of that talk is nice and all, but how did it translate into action?
The campaign raised a total of 0.01334522 BTC AND 0.1022 ETH. Out of these values, half was donated by BlockchainBH as part of our top-up program. The coins were kept in cold-storage in a Trezor Harware Wallet that was locked away in a secure place and only accessed after the campaign, to send the coins to an exchange. These were exchanged for Brazilian Reais on the 18th of July between 8.00AM and 8.20AM BRT, giving a total of 575BRL. Using the 575BRL, we were able to buy 29 blankets, after topping-up 4.71BRL ourselves. The blankets and receipt for the purchase are shown below.
On the 7th of August, 2018, the blankets were then delivered by us directly to homeless people spending the night on the streets of Belo Horizonte. We went out to Praça Raul Soares and surroundings at night to deliver the blankets. Photos below.
*I apologize for the low-quality pictures. To preserve the privacy of the people, we did not take many, and because of the lack of light, those few were not the best quality possible.
The campaign by the numbers
- Total donations in Reais: 575BRL
- Amount donated by BlockchainBH: 287.5BRL
- Number of donations: 10
- Total donations in BTC: 0.01334522 BTC
- Total donations in ETH: 0.1022 ETH
- Number of homeless people helped: 29
- Total amount paid in fees (whole process): 6.15BRL
- Average fee per transaction (excludes exchange fees): 0.40BRL
- Total amount paid in fees as percentage of donation total: 1.07%
- Total fees paid in BTC transactions (in and out): 0.00010922BTC
- Total fees paid in ETH transactions (in and out): 0.001806ETH
- Total fees paid in exchanges: 0.56BRL
- Total number of transactions: 14
*As of this writing, 1BRL = 0.27USD, 0.23EUR
**Values above calculated based on BTC’s and ETH’s valuation on 05/08/2018.
Important note: The numbers above show that our objectives were met using cryptocurrency. The average transaction cost for the transfers in the campaign was slightly over 0.10USD, which is up to 40x cheaper than electronic money transfers within Brazil, and even cheaper when compared to international transfers. Also, the full disclosure of the numbers above ticks the transparency box, since, with the exception of the exchange fees, all those statistics can be verified by anyone who wishes to, removing the need to trust the campaign organizers for the information.
Conclusion & Reflections
Going straight to the point: 575BRL is not a lot of money. But in this case, it is not the value that is the most important part (although we wished to have been able to help more and more homeless people). The key takeaway from this campaign is the validation of a model that can easily be scaled.
Unfortunately, the idea to run the campaign happened quite late, when winter was already too close. For that reason, we had to speed up the process to be able to deliver the blankets as early as possible, for them to be of good use. Time was the largest limiting factor of the campaign.
But ultimately, the campaign was a great success in our eyes, because it:
- Helped 29 homeless people have a warmer night
- Raised awareness to an issue from people around the world
- Proved that blockchain technology (represented in this case in the form of cryptocurrency), can already be utilized in a simple manner to develop useful solutions
Having now tested and confirmed the model, we hope to keep on improving its implementation, and intend on making use of its improved form for future campaigns. In particular, an important consideration would be running a similar campaign for a longer period of time. Other methods of fundraising can also be implemented using blockchain technology, such as the use of tokens, that can serve the purpose of a badge that signifies “I donated”.
Once more, thank you to all those who donated and supported us and to the whole BlockchainBH team for an awesome campaign!
If you would like to learn more about ‘Warm Up!”, you can visit blockchainbh.com/help for more info. Also, we would appreciate feedback, that can be sent in the comment section of this article or directly to me on my email below. Lastly, if you’re interested in the model and want to implement it for your own project, you can also contact me, and we will be happy to assist in any way possible.
And hey, maybe cryptocurrency is not that bad after all, huh?