Crypto introduces new horizons for charity efforts, with revolutionary features powered by its underlying blockchain technology. For example, donating in crypto helps givers trace the footprint of aid, which ensures accountability. Further, using the same currency allows smoother operations across multiple regions and jurisdictions.
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Since blockchain is global, crypto can be donated from anywhere to anywhere in the world, eliminating reliance on banks. This is essential for charities operating in underbanked or unbanked areas. Due to all these reasons, crypto charity is soaring despite the prolonged bear market. For philanthropic organizations, it is no longer a question of if they’ll start accepting crypto donations, but when.
However, donors are far from the only party benefiting from crypto-based charity efforts. Crypto donations amplify organizations’ impacts, as they can directly reach the hands of individuals, streamlining the support process and providing easier access to larger population segments. They enable projects to be more effective by encouraging financial literacy and autonomy with an emphasis on education.
Crypto Charity Removes Risks Associated with Fiat Money
Providing cash assistance is an efficient way of delivering aid and has been praised for the dignity and autonomy it bestows on recipients. People appreciate retaining the freedom to make decisions about their future, including what they spend their money on.
Philanthropic organizations often hesitate to distribute physical cash to individuals in need, primarily due to the associated risks of handling cash and the possibility that recipients lack the education and awareness to make responsible financial decisions. To protect recipients, organizations often choose to help in other ways, such as building community projects.
Crypto donations offer an alternative: delivering aid to individuals in need in a secure and sustainable way by making international transactions much more efficient than fiat money transfers. No risk of theft or violence, no hidden costs, no taxation, and no corporate agenda.
Independent NGO Oxfam International’s UnBlocked Cash project stands as an example of how blockchain technology is revolutionizing humanitarian aid. The project provides financial assistance to communities in Vanuatu and Papua New Guinea while saving distribution costs, reducing delivery times, and bringing more transparency and accountability. The blockchain technology is used to empower people and to bring them into the local economy.
Charity Goes Beyond Financial Aid
Financial literacy is a crucial part of philanthropic efforts like this, as the majority of people in need live in unbanked or underbanked areas and don’t know how to manage their personal finances. Adding a new asset class like cryptocurrency to the mix with no education or training as to how to put it to good use could bring complications and confusion for recipients.
This education aspect is the part that makes projects truly impactful and sustainable in the long term, as organizations are not only providing fish but teaching people how to catch their own. Recipients have access to a new financial system forever and are at the center of a technology and banking revolution.
This is how Binance (BNB-USD) Charity is working with major international humanitarian agency CARE International in Kenya to provide financial literacy education alongside crypto donations in the form of crucial Community-Based Trainers (CBTs).
The pilot project focused on helping Kenyan Village Savings and Loans Associations (VSLA) members recover from the economic impact of COVID-19. It involved the provisioning of blockchain-based e-vouchers and creating direct employment of CBTs to educate village members about crypto vouchers and blockchain.
The financial autonomy of the villagers has become the biggest gain of the project, with a blockchain-based infrastructure established to help people make, manage, and save money in the long term. According to a survey of the VSLA members, 98% of participants in the project deemed crypto vouchers an “excellent” or “good” vehicle of support.
Creating shared funds through the VSLAs was another important aspect of ensuring the donations were used responsibly. The money could go directly to individuals who were then free to use it however they wished, but they remained accountable to one another, which reduced wasteful or irresponsible activity.
Social Impact Through Crypto and Education
Partnerships between crypto companies and charity organizations vastly increase the impact of philanthropic efforts, as these charities have established structures and coordinate with existing community groups in key areas. Since there is already a local chain of trust that extends from relief organizations to the members of the community, it becomes faster and easier to build internal trust and unity.
By targeting all community members regardless of their gender or age, projects like those mentioned above also help to strengthen women’s economic empowerment and minimize gender inequality. This is especially important in traditional societies, where for many years, economic power was held exclusively by men.
The fundamental goal of crypto, to achieve economic accessibility on a global scale, requires financial education among populations first. This is why educational aid in underprivileged areas ties in perfectly with the wider crypto mission, as the people in need are usually ignored by banks and traditional finance. With proper training and education, they can be empowered by cryptocurrencies.
Crypto philanthropy has the potential to become a new norm of charity, solving age-old problems while streamlining the process for both sides. Crypto donations go directly into the hands of needy individuals, eliminating the need for intermediaries and boosting accountability for all parties involved. When combined with an established education program on how to actually utilize the aid, it can pave the way for true financial autonomy around the globe.
