Many nonprofit leaders face a similar dilemma: how can we attract new, younger donors to invest in our cause? A good starting point is to get up to speed on how younger generations want to make a contribution. Millennial and Generation Z donors are investing in and spending cryptocurrency at increasing rates, and if you aren’t set up to welcome them, you may be missing out on your portion of a $300 million pool of charitable funding.
Wait, crypto-what? Learning about cryptocurrency can be a bit daunting. We get it. But let’s break it down together. Cryptocurrency is a digital token that can be bought, traded, transferred, and sold electronically without the services of a bank (minimizing fees and allowing anonymity). Transactions are secured through cryptography and documented in a public ledger which serves as a record for currency holders. Although there are thousands of cryptocurrencies, Bitcoin is the most well known. It might seem like an obscure technology, but there are over 100 million crypto users today - more than Venmo.
So what does this mean for nonprofit leaders like you? There are advantages to cryptocurrencies that are inspiring a new, tech-savvy audience to donate crypto to their favorite causes. The Giving Block, a nonprofit crypto-fundraising platform, explains: “Your donors may see their gift as altruistic and possibly one of the most tax efficient ways to offset their capital gains taxes levied from their crypto investments and trades, which can often total 30%+ of their appreciated cryptocurrency.”
Translation: donors want to reduce their tax burden and donating crypto helps them do that. Think of cryptocurrency like stock investments - donors are able to give more money to your organization by donating it directly instead of selling their investment first and paying capital gains taxes. There’s a tax benefit for you, as well: “In the US, cryptocurrencies are classified as property assets by the IRS, so donations of crypto can be considered charitable write-offs for donors and tax-free for the nonprofit.”
So what do you need to do to receive crypto donations?
First, you need to partner with a solution provider, like The Giving Block, to get the right tool on your website to accept cryptocurrency donations. Then you’ll need to strategize how to attract crypto philanthropists.
CauseMic specializes in researching and designing donor personas and creating personalized campaigns that target your custom audience. We’ve helped nonprofits like yours fundraise millions of dollars in new, innovative ways, leveraging technology and best for-profit practices. If you haven’t yet considered how to tap into your prospective donors under the age of 40, it’s time to start. Call us today to schedule a complimentary 15-minute strategy session.