Demystifying Cryptocurrency Donations: A Guide for Nonprofit Leaders
While cryptocurrency has had its ups and downs, the market is valued at over $1 trillion. Many nonprofit leaders wonder if accepting cryptocurrency donations is right for their organizations, and if yes, how to get started. Nonprofit leaders may have questions:
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- What is cryptocurrency? Is it Bitcoin? The blockchain?
- How can I understand what feels like confusing jargon and complex technology?
- What about the debate about the environmental impact of cryptocurrency?
- What about the news stories that make cryptocurrency sound so volatile?
Developed in 2023 by a team of nonprofit management professionals and informed by interviews with nonprofit leaders and cryptocurrency solutions providers, this guide is designed to help leaders of 501(c)(3) nonprofit organizations, specifically with small to mid-size organizations in mind, navigate whether and how to accept cryptocurrency donations. The resources explain the range of options available, how each approach works, what they require of and offer to the organizations who use them, and how each option aligns with particular concerns and considerations.
Resource List
“Hearing the word ‘crypto’ can be scary. What IS crypto? Is it real, is it safe to buy, sell, accept donations? My job as the Chief Financial Officer is to make sure the organization stays relevant and current in its financial infrastructure. Before accepting a gift of cryptocurrency, it was important to educate our Leadership Team, our Board of Trustees, and our Donors, about crypto, based on facts. These conversations allowed us to make the right decision whether to accept or not, as well as how, in alignment with what is important to our organization. Having trusted resources such as this toolkit, are critical to continued learning and growing in an ever-changing world.”
Kimberly Spurgeon
Chief Financial Officer, Dayton Art Institute
Overview
Key highlights from what we’ve learned and how to get started using the guide
Key Considerations
Addresses the issues likely to be discussed with stakeholders, including potential risks associated with accepting cryptocurrency and how to evaluate any potential values misalignment
Solutions Companion
Outlines the types of options available for organizations who make the decision to accept cryptocurrency donations, including the advantages and tradeoffs of each type
Policies & Procedures
Outlines the accounting, tax, and reporting rules associated with accepting cryptocurrency donations, including donor acknowledgement and gift acceptance considerations and templates
Fundraising Resources
A QuickStart guide for organizations new to raising cryptocurrency donations, as well as communication samples
More Information
Further reading on the history of cryptocurrency, definitions of key terms, and links to additional resources
These resources were completed with funding from the Fidelity Charitable® Trustees’ Initiative (FCTI), a grantmaking program separate from Fidelity Charitable’s donor-advised program. FCTI did not weigh in on the substance of the content provided, and the findings and conclusions contained within are those of the authors and do not reflect advice or official positions of FCTI.
