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A new way to get crypto freebies
Cryptocurrency mega-donations continue to grab the headlines, but many nonprofits are still uncomfortable or unsure how to join in on the action.
Now, a new nonprofit giving platform makes it as easy as accepting a gift from a donor advised fund. Endaoment sponsors DAFs built on the Ethereum blockchain, the world’s most widely used platform supporting smart contracts, a program that automatically ends a transaction when pre-agreed criteria are met. The idea is to create an easy way for people to donate cryptocurrency without having to sell it first and for US nonprofits to accept it in cash.
The idea is the brainchild of 30-year-old Robbie Heeger. In 2016, he and his brother established a donor-advised fund within the San Francisco Jewish Community Federation and Endowment Fund. At the time, Heeger was working at Apple and made a habit of making regular contributions from the company’s stock to the CFO.
Several years earlier he had started dabbling in digital currencies, making investments here and there. When Heeger left Apple in late 2018, he no longer had the same company stock supply line to fund the CFO. Most of its assets were in cryptocurrencies.
When he approached the federation in mid-2019 to donate lesser-known crypto coins, “they kind of looked at me with that 100-meter gaze,” he says. “We really want this gift but do not know how to manage it”, he recalls, telling him that the staff of the federation.
At that point, something clicked for Heeger, who had learned to code. He came back to his federation contacts with a proposition: “What if I approach you with software that allows you to take the gift?” They said, “If you can bring us the software, we can help you make it.
Joy Sisisky, the federation’s head of philanthropy, wanted to make it happen, she said. “Instead of saying, ‘No we can’t,’ we said, ‘Alright. Let’s find this together.'”
The software Heeger built allowed him to donate cryptocurrency and convert it into cash that the federation could easily accept. Even charities that were once reluctant to accept digital currencies say finding a way to accept them has the added benefit of helping them attract young male donors who tend to use cryptocurrency but are elusive as supporters. many non-profit organizations.
Heeger also saw how blockchain technology could disrupt some commonly cited complaints about CFOs. For example, fund sponsors benefit financially from having a donor keep the money in a DAF for a long time rather than sending it to charity. And there is a lack of transparency about the amount of wealth going in and out of funds. Heeger launched a pilot project in February 2020 that worked not only to make it easy for donors and charities to transfer cryptocurrencies, but also to provide a bigger window into money going in and out of DAFs.
Since then, donors have given over $ 2.5 million to Endament’s funds and have distributed over $ 1.8 million to nonprofits. Heeger hopes this is just the start.
“We want to demystify the process of accepting a crypto gift,” he says. “We want to see crypto money flow into the hands of organizations that need it.”
Endaoment joins a range of third party entities that are springing up to help nonprofits accept these gifts. Groups like Giving Block, Every.org, Engiven, and BBB Wise Giving Alliance’s GiveSafely platform all facilitate the transfer of cryptocurrencies to charity vaults. These companies, along with many large organizations sponsoring DAF, tend to only accept a handful of the most popular cryptocurrencies, like Bitcoin, while Endament accepts around 150 types of coins.
Endaoment also launched pooled “community funds” that allow owners of specific digital tokens to collectively support nonprofits and vote for who receives those funds. (The name Endaoment is a game about Decentralized Autonomous Organization, or DAO, a cryptography-based organizational model that aims to democratize decision-making among its members.)
Learn more about how Endament works and how nonprofit fundraisers respond to digital currency donations, and discuss this form of donation with donors.
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