Why Charities Are Turning to Web3 for a More Sustainable Future

Charities have always been among the most important of all nonprofit organizations, because they help those in need, and also do so in an admirable way that doesn’t involve asking people to give up money or any other resources of value. Over time, many charities have made great strides in terms of running their businesses more sustainably, but some still rely on old-fashioned methods and are not as efficient as they could be. By choosing to use Web3 technologies and applications instead of older systems, charities can streamline their efforts and save money, enabling them to provide even more help to those in need with their limited resources.

The shift from charity donations to Blockchain for good

Blockchain technology has already been used to create new kinds of financial services, such as Bitcoin and Ethereum. Now, the same innovation is being applied in the charitable space. This is evidenced by the fact that there are now three blockchain platforms focused on charity management and social good: GiveTrack, BitGive Foundation, and The Human Trust Foundation.

These are an exciting new frontier for charities, who can use the revolutionary system to track donations more effectively, so they can tell donors where their money is going with less bureaucracy. There’s also no need for expensive accounting software or transaction fees like banks charge. In addition, this decentralized system makes it impossible to tamper with transactions or steal identities- making it much safer than the traditional banking system.

The first blockchain platform, GiveTrack, was developed in 2016 by social entrepreneurs and former Bitcoin Foundation employees Patrick M. Byrne and Brian F. Fitzpatrick. Their aim was to make charitable donations easier by putting transactions on a public ledger that anyone can check. This way, donors will know exactly how their money is spent and they can support specific projects they care about rather than just sending funds blindly to charities with little accountability.

BitGive Foundation was created by two Bitcoin enthusiasts in 2013 with the goal of increasing transparency within philanthropy. The founders were early adopters of Bitcoin and wanted to give back through philanthropy which led them to found Bitgive. They have partnered with notable nonprofits such as Save the Children, World Wildlife Fund, and CARE International.

Lastly, the most recent entry into the field, The Human Trust Foundation wants to provide the next generation of giving tools. They are a registered Swiss foundation based in Geneva and want to be at the forefront of humanitarianism by leveraging blockchain technologies to provide high standards of transparency and accountability.

What is the Decentralized Fundraising Initiative?

The Decentralized Fundraising Initiative (DFI) is an effort to harness the power of blockchain technology and create a sustainable fundraising platform with no centralized authority. By placing donations directly in the hands of charities, DFI will allow charities to make more efficient use of funds and offer donors transparency as to where their contributions are going.

How will it benefit charities?

• The blockchain can help charities provide more transparency and accountability, which is essential in ensuring that donated funds are utilized effectively.
• Blockchain technology gives donors the ability to see how their money is being used without the need of an intermediary.
• Blockchain allows nonprofits to cut out any middlemen and deal directly with one another while still guaranteeing the transaction was executed properly. This system allows organizations that work across borders to keep track of what’s happening even if they’re working with different currencies.
• Nonprofits have been looking for ways to reduce costs over time so that donors can have peace of mind knowing their contributions will go towards programs rather than administrative fees. By implementing blockchain into daily operations, charities will save money by cutting out intermediaries and data management services like payroll companies or accounting firms because everything will be stored securely on one networked ledger.
• The use of blockchain technology will make it easier for charities to share donor data, giving more insight into how their money is spent and where it’s going. The increased visibility will also reduce the risk of fraud. This is just one way the use of blockchain can help improve the current charitable system.