The charitable sector consists largely of legacy organizations relying on traditional fundraising tactics and campaigns. With the advent of independent, more decentralized initiatives, many smaller nonprofits and grassroots causes have begun fundraising for themselves, however have come up against the same issues plaguing large charities: high fees and long payment remittance times. Cryptocurrency presents an ideal use case to combat these issues, as high fees, often weeklong wait times, long approval processes, and depending on the region, corrupt banking systems and governments are all bypassed. Another advantage with fundraising using cryptocurrency is donor transparency. With traditional fundraising channels, donors are largely unable to track their donations, and must simply put their trust in the organization that their funds have gone to the appropriate places.
In this guide I will walk readers through choosing a wallet, publishing QR codes on their website, linking to their ledgers, and will provide some additional resources for managing their funds.
Choosing a Wallet
When choosing a wallet, it’s important that the wallet have static QR codes. This means that a QR code is not generated every time a transfer is sent, as this would mean the QR code published on site would have to be reuploaded every time a donation is received, a very tedious and time consuming process. You also want to avoid keeping your funds on an exchange and instead download a reputable wallet app instead. Personally, I would recommend the BRD wallet as it is a wallet I have used for fundraising in the past. If you decide to choose another wallet, I would recommend one that accepts Bitcoin, Ether and a stablecoin like DAI, this way donors have options. Once you’ve selected the appropriate wallet, make sure to save and back up the seed phrase across multiple (secure) platforms, as if it is lost so are your funds.
Publishing QR Codes
Once you’ve selected your wallet, set a password and recorded your seed phrase, it’s time to generate a QR code for your site. I will be using the BRD wallet as an example, but the process is similar across most wallets. Supported currencies will display on the home page, and to add any additional currencies, simply tap on “Manage Wallets,” then “+Add Wallets.”
From there, tap on the currency you wish to generate a QR code for, then at the bottom of the screen tap on “Receive.” A QR code and wallet address will then pop up with the option to share. You can then embed the QR code and address into your donation page, giving donors the option to scan the code or copy the address manually.
Linking to Ledgers
As previously mentioned, a marked advantage of accepting cryptocurrency is the ability to publish all transactions by linking to your wallet’s public ledger, accessible by a block explorer. To find your wallet’s public ledger, copy the wallet address and paste it into the search bar of a block explorer like blockchain.com for Bitcoin, Bitcoin Cash, and Ethereum or Etherscan for any ERC20 tokens like DAI. This will give you a list of all transactions made to and from the wallet, the amount of funds sent and received, as well as the date and time and other relevant information. By hyperlinking the QR code with your wallet’s address on a block explorer, donors can click on the code to see all past donations. This presents a real time public ledger detailing all transactions, rather than having to publish quarterly reports.
Accepting cryptocurrency is a great way to take control of your organization’s finances as well as reach a new demographic of donors, but not all beneficiaries or field offices accept it yet. In some cases, you will have to transfer your crypto into fiat. Depending on where you’re located, there are some great services to handle the logistics of this for your organization. If you’re in Canada, I would recommend a service called Coinberry that allows you to sell your Bitcoin securely for fiat. Once you complete their KYC process, you can connect to your bank and transfer the funds directly into your bank account. If you’re outside of Canada, I would recommend Coinbase, a trusted exchange that again links to your bank account and allows you to sell your cryptocurrency.
If you’ve gotten to the end of this article but are still hesitant to begin accepting crypto, there’s 2 organizations, OpenNode and Bitpay, which allows your organization to accept cryptocurrency without the need to manage the funds. Bitpay will convert donations made in crypto into your local currency then will wire it into your associated account, and OpenNode allows you to create custom Bitcoin invoices. For reference, the Tony Hawk Foundation accepts Bitcoin and has the option to use both OpenNode and Bitpay. Check out their page to get an idea of the UI for both options.