In 2025, the British Red Cross raised £143,000 in crypto donations (approximately $191,835) through its ‘Humanity HODLRS’ initiative. Charitable organizations worldwide have noticed pattern: when the ability to donate in Bitcoin or Ethereum appears on a website, total donation volume grows by 20-40% (According to data from The Giving Block and Fidelity Charitable). Not instead of traditional payments, but in addition to them.
This article examines how blockchain technology works in charitable foundations. You may have heard of blockchain but have been putting off looking into it because the technology seems complicated or niche. The mechanics are simpler than they seem, and the audience is wider than you think. But there are real challenges too. So let’s dig in.
We’ll examine specific cases where adding a crypto option brought unexpected results to foundations. We’ll analyze why donors choose this method. And we’ll show the technical integration process – without programmer jargon, step by step.
Blockchain Basics
A blockchain is a distributed ledger that provides transparency, security, and immutability without the need for a central intermediary, and no one owns or can influence it. When someone sends Bitcoin to a charity, that transaction is recorded in a new “block” and added to the chain of previous blocks. Hence the name. Three things set it apart from regular databases:
- No one controls it.
- All transactions are visible to everyone. But you won’t see a message saying “John Smith sent money to the Red Cross.”
- You can’t cancel a payment.
Smart contracts add another layer. They are programs that run on the blockchain and execute automatically when conditions are met. Think of them as “if this, then that” instructions that no one can change. A charity can create a smart contract that will automatically distribute funds after certain milestones are met.
When Numbers Speak Louder Than Theory
GiveDirectly, an international direct cash transfer organization, launched a pilot project in 2022 accepting donations in USDC – a stablecoin pegged to the dollar. In the first three months, $4.7 million came from 127 donors. The average check turned out three times higher than with bank transfers.
According to the “2023 Annual Report on Crypto Philanthropy” from The Giving Block platform, organizations working with them received on average 32% more donations compared to the previous year. But more interesting: 67% of donors stated they had never previously supported that specific organization. The crypto option brought in a new audience.
During the active phase of recent conflicts, even small charities and foundations began to actively accept cryptocurrencies. Results exceeded expectations: in one year, several major relief funds received over $60 million in cryptocurrency. This didn’t replace traditional donations but created an additional channel from people who simply wouldn’t have donated otherwise.
The Wikimedia Foundation, which maintains Wikipedia, added cryptocurrency donation capability in 2014. Initially skeptically, as an experiment. Eight years later, they still accept crypto because a steady stream arrives annually – not millions, but hundreds of thousands of dollars from donors who can’t be reached by classic methods.
These cases share one thing: cryptocurrencies opened access to a new category of benefactors. Not instead of old ones, but alongside them. But before we get too excited, let’s look at what blockchain actually is and where things can go wrong.
How Crypto Donation Integration Works
A charitable organization doesn’t need to become a blockchain expert. A charitable organization doesn’t store keys, manage wallets, or understand blockchain technical details. Specialized intermediary services do this.
- Step one: the organization chooses a service provider. These can be companies like Inqud, which specializes in cryptocurrency payment gateway, The Giving Block, BitPay, Coinbase Commerce, or Engiven. Each has nuances: some focus on the non-profit sector, some offer automatic fiat conversion, some allow storing assets in crypto.
- Step two: registration and verification. The fund goes through KYC/AML checks – a standard procedure similar to opening a bank account. You provide documents confirming non-profit status, details, contact information.
- Step three: choosing supported assets. Minimum – Bitcoin and Ethereum, the most liquid coins. You can add stablecoins (USDT, USDC, DAI), which aren’t volatile. Some services offer dozens of options, but practice shows: 90% of donations come from the top five cryptocurrencies.
- Step four: technical integration. The provider gives a widget or plugin for your site. If the site is on WordPress, it’s literally a plugin with settings. If it’s custom development – an API with documentation. Usually integration takes a few hours of technical work.
- Step five: conversion setup. You decide whether to receive funds in crypto or automatically convert to dollars/euros/pounds. Auto-conversion is convenient if you don’t want to risk volatility. Keeping in crypto makes sense when you plan to spend funds quickly or believe in rate growth.
- Step six: compliance. Make sure your accounting software can track crypto donations. The IRS in the US requires reporting, and regulations in other countries are moving in this direction too. Most services provide automatic reports for tax authorities.
- Step seven: launch and communication. Announce the new option to donors. Add the crypto address to the donation page, email newsletter, social media. Explain benefits in simple language: “Now you can support us with Bitcoin, Ethereum, and other cryptocurrencies.”
The entire process from decision to first donation realistically takes a week or two if there are no bureaucratic delays.
Why People Donate Cryptocurrency
The first reason is tax efficiency in many jurisdictions. In the US, UK, and Germany, cryptocurrency donations exempt donors from capital gains tax. If you bought Bitcoin for $10,000, it grew to $50,000, and you decide to donate $10,000 to charity – when selling coins you’d pay tax on $40,000 in gains. With direct donation to the fund, there’s no tax. The fund receives the full amount, the donor saves money.
This isn’t a loophole but a legitimate mechanism that’s worked for decades with stocks and real estate. Now the same applies to digital assets.
The second reason is speed and absence of intermediaries. International bank transfers can take three to five days, fees eat up 3-7%. Blockchain transactions go through in minutes or hours, fees are usually lower. During humanitarian crises, when every hour counts, this is critical.
Third – privacy. Blockchain is open but pseudonymous. You see that funds went to a specific wallet but don’t see the sender’s name without additional information. For some donors, this is more comfortable than exposing card details.
The fourth reason is less obvious but important: demographics. Fidelity Charitable research shows 47% of millennial millionaires keep over 25% of their wealth in cryptocurrency. This is a generation of donors accustomed to digital assets. If a fund doesn’t accept crypto, it loses contact with this audience.
Fifth – ideological. Part of the crypto community values decentralization and financial independence. Supporting charity through blockchain aligns with their beliefs. This isn’t a mass factor but a stable one.
Global Trends Impossible to Ignore
The global blockchain solutions market, according to research estimates, should grow by 90% annually from 2025 to 2030. BitPay, one of the largest crypto payment processors, recorded 430% growth in charitable transactions from 2020 to 2023.
The International Committee of the Red Cross in 2023 published guidelines for national societies regarding cryptocurrency acceptance. UNICEF launched CryptoFund – a separate fund that accepts, holds, and distributes donations exclusively in digital assets without fiat conversion. This is institutional recognition.
Regulation is gradually crystallizing. The European Union adopted MiCA – a regulatory framework for crypto assets. The US is developing federal standards. This adds legitimacy and reduces legal risks for funds.
Technological infrastructure has matured. Five years ago, integrating crypto payments required your own technical department. Now ready-made solutions exist that connect in a day without any code.
The Problems Nobody Likes to Talk About
Volatility is the most obvious risk. Bitcoin can drop 15% in a day. If a fund received a donation and didn’t convert immediately, asset value changes. Solution: automatic fiat conversion immediately upon receipt. Most services offer this as an option.
Regulatory uncertainty exists but is decreasing. Several countries have adopted laws legalizing cryptocurrency circulation. Non-profit organizations can legally accept and use digital assets. In the US, the IRS classifies crypto as property, which gives tax benefits to donors.
Security requires attention. A fund shouldn’t store large amounts on hot wallets (connected to the internet). For long-term storage, use cold wallets – physical devices like Ledger or Trezor, disconnected from the network. Or trust a custodial service with a good reputation.
Does Crypto Suit Your Fund
If your audience is mostly people over 60 who donate by checks in the mail, crypto integration might not give quick results. But if donors include tech-savvy people, millennials, business representatives, or an international audience – it’s worth trying.
Adding a crypto option doesn’t require large investments. Basic integration is often free, services take commission on transactions (usually 1-3%). This is comparable to payment system fees like Stripe or PayPal.
Risks are controllable if you follow basic rules: use verified providers, don’t store large amounts without proper protection, convert volatile assets immediately if you’re not ready for rate fluctuations.
The main question isn’t “is it safe” but “are we ready for a new audience.” Blockchain opens access to donors who are hard to attract by traditional methods. This is an expansion tool, not a replacement for existing channels.
Bottom Line: What Happens Next
Blockchain opens a new channel for donations. For some organizations, it’s been genuinely valuable – new donors, larger average gifts, faster international transfers.
But it’s not universal. The technology comes with real drawbacks: volatility risk, regulatory uncertainty, environmental concerns, technical complexity, and limited mainstream adoption. Some of the shortcomings will be fixed soon, soon we will have:
- Central bank digital currencies are currently in the works. These cryptocurrencies are backed by governments and would offer the benefits of blockchain without the volatility. But most CBDCs are still in the pilot phase, and no one knows for sure how they will work with charitable donations.
- Layer-2 solutions like Lightning Network for Bitcoin and various rollups for Ethereum are making transactions faster and cheaper. This addresses two of the main technical complaints about blockchain.
- Regulation will crystallize eventually. Whether that’s good or bad for charitable organizations depends on what the regulations say. Clear rules are better than ambiguity, but clear restrictive rules are worse than ambiguous permissive ones.
If you’re running a charity, here’s my take: look at your donor demographics. If there’s meaningful overlap with the crypto-owning population, run a pilot. Use a reputable service provider, set up automatic conversion to fiat if you’re risk-averse, and see what happens over six months.
If it works, great. If it doesn’t generate meaningful donations, you can shut it down with minimal sunk cost. The beauty of this technology is that the barrier to entry is low enough to experiment.
Blockchain is a tool, not a revolution. Like any tool, it’s useful in some situations and pointless in others. Your job is figuring out which category your organization falls into.
Peyman Khosravani is a global blockchain and digital transformation expert with a passion for marketing, futuristic ideas, analytics insights, startup businesses, and effective communications. He has extensive experience in blockchain and DeFi projects and is committed to using technology to bring justice and fairness to society and promote freedom. Peyman has worked with international organizations to improve digital transformation strategies and data-gathering strategies that help identify customer touchpoints and sources of data that tell the story of what is happening. With his expertise in blockchain, digital transformation, marketing, analytics insights, startup businesses, and effective communications, Peyman is dedicated to helping businesses succeed in the digital age. He believes that technology can be used as a tool for positive change in the world.
