Blockchain technology in Fundraising.

Charities face declining donations among the young, increasing skepticism and concerns about where donations end up. At the same time, they struggle with inefficient, underfunded administrations that cannot direct aid adequately. Essentially, the term charity has been used and abused, and much of the public is no longer willing to take charities’ word as bond.

Blockchain technology is essentially a ledger of transaction data that is owned and maintained by all users of the system. Random actors in the market act as ‘nodes’ to verify and make sure that transactions added to the ‘blockchain’ are real. These transactions are then encrypted and added onto the public ledger which discourages fraud because they mean complete transparency of all transactions carried out, and is completely tracked and verified. Nothing can be altered once it’s in the ledger and it guarantees security against any kind of data manipulation.

Blockchain is a revolutionary technology that could have a huge impact on the charity sector and philanthropy, helping to manage and distribute funds in a secure and transparent way. By minimizing administrative costs through automation, providing more accountability through traceable transactions, and allowing donors to see more clearly where their funds are going, blockchain may help restore some of the lost credibility to charities that prove worthy of the public’s trust.

Digital fundraising can be transformed on a wider scale, by enabling charities to accept payments from anywhere in the world without the need to pay foreign exchange fees or consideration of currency exchange rates. For charities working in difficult parts of the world, the ability to trade in non-geographic currency can also be a massive benefit. Big names like UNICEF and The Salvation Army have registered onto the platform cryptogivingtuesday.org to accept Bitcoin, Ethereum, and other cryptocurrencies.

While blockchain and cryptocurrencies may still be mysterious to many, the growing interest, funding, and donor possibilities have excited many more, prompting not only individual charities to accept cryptocurrencies, but support for pilot projects to encourage its wider adoption.