Use Case: Re-Building Trust in The Non-Profit Sector Through Cryptocurrencies and Blockchain Technology - Nasdaq.com
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By Francesco Nazari Fusetti, Founder and CEO of CharityStars and Aidcoin The not-for-profit sector today is worth an estimated $2 trillion USD worldwide, yet headlines in recent times have seen the sector stumble between corruption scandals and gross inefficiencies.
Recent high profile scandals include; donors of the Helpers Community Inc raising concerns regarding the misuse of donations and the Trump Foundation admitting to self-dealing.
The continuous decline in trust on the part of potential donors is justifiable, According to Essential Research 35% of US citizens have little or no trust in charitable institutions.
Similarly in the UK, figures are not promising, with trust in charities falling from 6.7 out of 10 in 2014 to 5.7 in 2015, with 33% of those polled explaining that the primary reason for their reduction in donations stemmed from the impact of recent scandals on charities’ reputations.
Naturally, the consequences of donations decreasing is alarming; in the US, 52% of charities are not adequately funded and cannot match the distressing increase in demand for their services.Given recent scandals, it is understandable that society has grown skeptical towards the non-profit sector.
However, there is a solution that has the potential to transform the industry. Blockchain-powered smart contracts and the adoption of cryptocurrencies which is providing transparency, enabling efficiency and cutting costs.
The application of this technology offers innumerable opportunities; with the ability to re-establish trust in the sector, helping worthwhile causes and the most vulnerable in society, that are deeply reliant on this sector and its services.
Non-profits are already noting the impact of cryptocurrencies and blockchain technology, highlighting the long-term potential for delivering results and shaking up the stagnant sector.
For example, Legambiente, a non-profit organization in Italy, enlisted help from Helperbit to adopt bitcoin. The CEO and Co-founder, of Helperbit Guido Baroncini Turricchia believes that in the long-term more people will buy bitcoin with donating in mind, due to its additional benefits.
Non-profit organisations such as The Red Cross, United Way, Greenpeace, Save the Children, and Wikimedia accept bitcoin donations, with all of the charities expressing the benefit of donations being recorded immutably and transparently.
Save the Children was one of the earliest adopters of bitcoin, following a devastating typhoon in The Philippines in 2013, with the rest of the charities outlined above following suit in 2014.
The crypto community is also bridging the gap between emerging technology and the traditional non-profit sector. Coinbase, a cryptocurrency trading platform, removed the payment processing fee for non-profits and charitable organisations, furthermore increasing the incentive to donate and accept cryptocurrencies.
While $370 billion USD worth of donations go to over 1.5 million charities in the US every year, online donations, only account for 5% of total transactions and the use of cryptocurrencies has yet to grow within the sector.
However, by 2025 10% of GDP is expected to be generated by blockchain technology and cryptocurrencies have already reached a total market capitalization of $200 billion.
The room for improvement and the unchartered territories of blockchain opportunities are vast. Even those skeptical of the hype and speculation behind many cryptocurrency investments, Barbas and Zuckerman concedes that cryptocurrencies can push forward the conversation about financial inclusion in many promising ways.
Start Network, a UK based network of leading charities, determined that blockchain “could catalyze a new way of working, one that is transparent, fast and which drives accountability to taxpayers and those affected by crises.
”The issues plaguing charities worldwide are innumerable and cannot be countered by relying on traditional methods.
Nor can we afford to maintain the status quo or harbor doubts about the impact new technologies can actually bring.Wars, climate change, natural disasters, immigration, and the erosion of the welfare state render the services provided by non-profits ever more in demand by billions worldwide.
The solution is, for once, simple and close at hand – the widespread adoption of blockchain technology by charities and donors alike, which will in time re-sow the seeds of trust, to the benefit of worthwhile charitable endeavors and the most vulnerable in our society.
Francesco Nazari FussettiCEO and Founder, CharityStars and AidcoinFrancesco Nazari Fussetti is a serial entrepreneur who has proven his tenacity through numerous ventures he has built from the ground up.
At just 20 years old, Francesco launched his first venture, ScuolaZoo, the largest online community for students in Italy. With six million users, ScuolaZoo has grown into a $12 million USD social network with 70 employees in its Milan headquarters.In 2013, Francesco founded CharityStars, the leading online fundraising auction platform for the non-profit sector.
Leveraging on the power of celebrity, technology and the media, CharityStars’ vision is to help charities transition to digital fundraising. To date, CharityStars has raised over $10 million USD in funds, supporting 450 charities including Unicef, Save the Children and WWF.
About AidCoin:CharityStars is creating AidCoin, an ERC20 token that will provide transparency in the nonprofit sector, allowing individuals to track their donations on the AIDChain public ledger.
AIDCoin additionally allows charities to integrate a donation button, called AIDPay, on their website that enables the acceptance of crypto currencies for their fundraising campaigns. Donors can donate in any cryptocurrency or altcoins that will be converted into AidCoin at the current exchange rate.
CharityStars will be the first fundraising website to utilize AIDChain and to accept AidCoin within its own ecosystem of charities, donors, celebrity donors and events.
For more information please visit: https://www.charitystars.com and https://www.aidcoin.co/
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
NASDAQ publish regular articles on Blockchain and Cryptocurrencies that you can discover here: http://www.nasdaq.com/article/rebuilding-trust-in-the-nonprofit-sector-through-cryptocurrencies-and-...
Recent high profile scandals include; donors of the Helpers Community Inc raising concerns regarding the misuse of donations and the Trump Foundation admitting to self-dealing.
The continuous decline in trust on the part of potential donors is justifiable, According to Essential Research 35% of US citizens have little or no trust in charitable institutions.
Similarly in the UK, figures are not promising, with trust in charities falling from 6.7 out of 10 in 2014 to 5.7 in 2015, with 33% of those polled explaining that the primary reason for their reduction in donations stemmed from the impact of recent scandals on charities’ reputations.
Naturally, the consequences of donations decreasing is alarming; in the US, 52% of charities are not adequately funded and cannot match the distressing increase in demand for their services.Given recent scandals, it is understandable that society has grown skeptical towards the non-profit sector.
However, there is a solution that has the potential to transform the industry. Blockchain-powered smart contracts and the adoption of cryptocurrencies which is providing transparency, enabling efficiency and cutting costs.
- No costs: With traditional donations, money goes through various middlemen, such as government agencies and financial institutions, and fees (approximately 3%) are charged by credit or debit card as well as by clearing houses. Blockchain donations are executed directly, reaching the charity instantaneously and at a fraction of the cost.
- Efficiency: Thanks to the distributed ledger technology, blockchain donors can track how their cryptocurrency is being used by charities. No record on the blockchain, in fact, can be erased, thereby providing traceable accountability showing the exact flow of any coin in the ecosystem. Non-profits too can use the blockchain to manage resources, reduce overheads, streamline their supply chain, and waste fewer resources.
- Transparency: If certain KPIs or other predetermined conditions aren’t fulfilled, smart contracts allow donors to receive their donations back or to redirect them towards more deserving or pressing causes. In 2010, the Red Cross raised $500 million USD to build 130,000 homes in Haiti, however only six homes were built, this would have been a prime use case for the transparent technology.
- Tax Deduction: Although formal guidance still isn’t available, the IRS treats virtual currencies as noncash assets and, therefore, eligible to be treated as long-term capital gain property. Moreover, while for traditional donations over $5,000 USD, a qualified appraisal is required, blockchain donations are exempt as they are transparently and publicly traded.
The application of this technology offers innumerable opportunities; with the ability to re-establish trust in the sector, helping worthwhile causes and the most vulnerable in society, that are deeply reliant on this sector and its services.
Non-profits are already noting the impact of cryptocurrencies and blockchain technology, highlighting the long-term potential for delivering results and shaking up the stagnant sector.
For example, Legambiente, a non-profit organization in Italy, enlisted help from Helperbit to adopt bitcoin. The CEO and Co-founder, of Helperbit Guido Baroncini Turricchia believes that in the long-term more people will buy bitcoin with donating in mind, due to its additional benefits.
Non-profit organisations such as The Red Cross, United Way, Greenpeace, Save the Children, and Wikimedia accept bitcoin donations, with all of the charities expressing the benefit of donations being recorded immutably and transparently.
Save the Children was one of the earliest adopters of bitcoin, following a devastating typhoon in The Philippines in 2013, with the rest of the charities outlined above following suit in 2014.
The crypto community is also bridging the gap between emerging technology and the traditional non-profit sector. Coinbase, a cryptocurrency trading platform, removed the payment processing fee for non-profits and charitable organisations, furthermore increasing the incentive to donate and accept cryptocurrencies.
While $370 billion USD worth of donations go to over 1.5 million charities in the US every year, online donations, only account for 5% of total transactions and the use of cryptocurrencies has yet to grow within the sector.
However, by 2025 10% of GDP is expected to be generated by blockchain technology and cryptocurrencies have already reached a total market capitalization of $200 billion.
The room for improvement and the unchartered territories of blockchain opportunities are vast. Even those skeptical of the hype and speculation behind many cryptocurrency investments, Barbas and Zuckerman concedes that cryptocurrencies can push forward the conversation about financial inclusion in many promising ways.
Start Network, a UK based network of leading charities, determined that blockchain “could catalyze a new way of working, one that is transparent, fast and which drives accountability to taxpayers and those affected by crises.
”The issues plaguing charities worldwide are innumerable and cannot be countered by relying on traditional methods.
Nor can we afford to maintain the status quo or harbor doubts about the impact new technologies can actually bring.Wars, climate change, natural disasters, immigration, and the erosion of the welfare state render the services provided by non-profits ever more in demand by billions worldwide.
The solution is, for once, simple and close at hand – the widespread adoption of blockchain technology by charities and donors alike, which will in time re-sow the seeds of trust, to the benefit of worthwhile charitable endeavors and the most vulnerable in our society.
Francesco Nazari FussettiCEO and Founder, CharityStars and AidcoinFrancesco Nazari Fussetti is a serial entrepreneur who has proven his tenacity through numerous ventures he has built from the ground up.
At just 20 years old, Francesco launched his first venture, ScuolaZoo, the largest online community for students in Italy. With six million users, ScuolaZoo has grown into a $12 million USD social network with 70 employees in its Milan headquarters.In 2013, Francesco founded CharityStars, the leading online fundraising auction platform for the non-profit sector.
Leveraging on the power of celebrity, technology and the media, CharityStars’ vision is to help charities transition to digital fundraising. To date, CharityStars has raised over $10 million USD in funds, supporting 450 charities including Unicef, Save the Children and WWF.
About AidCoin:CharityStars is creating AidCoin, an ERC20 token that will provide transparency in the nonprofit sector, allowing individuals to track their donations on the AIDChain public ledger.
AIDCoin additionally allows charities to integrate a donation button, called AIDPay, on their website that enables the acceptance of crypto currencies for their fundraising campaigns. Donors can donate in any cryptocurrency or altcoins that will be converted into AidCoin at the current exchange rate.
CharityStars will be the first fundraising website to utilize AIDChain and to accept AidCoin within its own ecosystem of charities, donors, celebrity donors and events.
For more information please visit: https://www.charitystars.com and https://www.aidcoin.co/
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
NASDAQ publish regular articles on Blockchain and Cryptocurrencies that you can discover here: http://www.nasdaq.com/article/rebuilding-trust-in-the-nonprofit-sector-through-cryptocurrencies-and-...