How Blockchain Can Revolutionize Philanthropy
Charity.
This word triggers a basic unit of the amalgamation of selfless acts and skepticism. Skepticism? That’s right. A pool of reports on faux fundraising, unauthorized funding, false invoicing and donation scams has led to a huge decline in donations.
The growing skepticism has changed the public perception of charity. Philanthropists nowadays, concerned with increasing fraudulent charity events, see the red flag in most of the charitable solicitations. Why do people in need have to suffer the consequences of the actions of fraudsters? Why do they have to suffer for the corrupt system in the name of charity? Wouldn’t the face of charity change, if the system was more transparent? Wouldn’t it be easier to break the skepticism if donors could personally connect to the mission of charities without the inclusion of the third party?
This is where blockchain steps in to change the face of charity. The groundbreaking potential of blockchain can be leveraged to bring a huge impact on the system of donations. Blockchain can truly disrupt the charity sector to make the system more transparent, reliable and secure.
Trending Cryptocurrency Hub Articles:
2. New Crypto Game on the Block!
Let’s become familiarized with salient features of blockchain that guarantee the revolution of the charity sector.
Transparency
Blockchain offers transparency of transactions among all the nodes connected in the blockchain. The immutability of transactions guarantees a closer connection of donor with donee. The data embedded within the block is made public to provide transparency. Multi-level checks could be added as if the organization fails to verify the utilization of the donated amount was put social work or sent to the donee then the amount will be transferred back to the donor’s block. Such verification checks keep the donor updated if the donated money was put to good use or not.
Decentralization
As the word suggests, no single entity has authority over all the systems. Blockchain uses consensus protocols across a network of blocks connected in a chain to politically and architecturally decentralize the monolithic system. This gives a break to false invoicing. Decentralization ensures that there is no central authority to meddle with the fundings and hence it assures the donor that the donee will receive every bit of donation. Not only it eliminates the third party risks, but it also speeds up the transfer from donor to the non-profit organization.
Authencity
“What if a fraudster tries to impersonate a non-profit organization lead?” Blockchain can easily overcome this issue too. Every time a block is added to the blockchain, a series of checks is performed on that block as part of the authentication procedure. The process of mining is much difficult. This gives assurance to the donor that the amount is transferred to a well-authorized organization.
Security
With the evolution in the system of the charity sector, philanthropists might level up the frequency and amount of donation. What if an organization is tempted to receive more funds and tries to add a malicious block at the end of the chain? In this case, the organization is an authenticated member of the blockchain. Does the authentication of a member guarantees the inclusion of the member in blockchain? No.
Blockchain comes with a sequential level of verification checks. Even if the organization qualifies the authentication level checks, the algorithms at the security level will detect the malicious block. Based on the charity system guidelines, that organization could further be globally eliminated from the charity platforms.
Reduced Transfer Rate
Considering international transactions, the Exchange rate varies depending on the currency values of end countries. If this rate adds up to a massive amount then the donor might end up having second thoughts regarding donation. With the transaction using cryptocurrency (which is also a blockchain implementation), the transfer rate will be reduced as there will no requirement for conversion based on end countries’ currency value. The global value of cryptocurrency hence results in a reduction in exchange rates.
Many organizations like Binance Charity Foundation, Disberse, Fidelity Charitable, Giveth have accepted blockchain as an integral part of their system. Such platforms are playing a major role in accelerating the benefits for those in need. Creating a decentralized and transparent community around crowdfunding and bringing accountability to charitable donations is taking the charity sector to the next level. Blockchain, indeed, is revolutionizing the philanthropy.
Don’t forget to give us your 👏 !
