Yerevan (CoinChapter.com) — Non-fungible tokens (NFTs) are the new trend in town. From decade-old YouTube videos to digital art and music, everything is being converted to NFT and sold. However, NFTs are not just a way to boast ownership over unique non-fungible tokens. They have now become a method of doing charity and helping non-profit organizations.
While people continue to scratch their heads over the number of people ready to shell out big money for ownership of digital art and memes, there is a whole sector that is using the trend to its benefit.
Modern-day fundraisers rely on NFTs. For example, the world-famous dictionary firm Merriam-Webster recently sold its definition of NFT to benefit Teach for All, a global organization that helps children in disadvantaged communities fulfill their potential.
Fighting The Lockdown Through Blockchain
Due to the imposed lockdown due to the Covid 19 pandemic, many charities worldwide found themselves in a hard place. Unable to organize charity events and fundraisers, they were forced to dive deep into their coffers to keep operations afloat.
However, as the lockdown lasted longer than expected, charities had to improvise. This led them to rely on the new blockchain technology to raise funds. While bank transactions were always an option, the new technology was quicker, borderless, and required no bank approvals.
Many charities are already accepting alternate donation forms, especially cryptocurrencies. Now, it is the NFTs that have jumped in to give the charities a push.
Tax Breaks for Crypto Donations
Joining the list of organizations that accept donations through Cryptocurrencies are some big names in the non-profit sector.
The American Red Cross, for example, has been accepting bitcoin for the past 7 years. Back in 2014, Bitpay tweeted about its decision to accept donations in Bitcoin (BTC) through its platform. BitPay is a bitcoin payment service provider headquartered in Atlanta, Georgia, United States.
The world-famous Save, The Children charity organization is also among the organizations accepting crypto donations.
The Water Project charity has 17 crypto options in its fundraiser, including Bitcoin, Ethereum and Dogecoin.
UNICEF also launched its CryptoFund in 2019 to allow patrons to donate to cryptocurrencies.
There are also crypto start-ups like The Giving Block that enable non-profit organizations to receive donations in crypto.
According to the website, when one makes a donation to a charity listed on their platform, they receive tax breaks.
“These nonprofits accept cryptocurrency donations, like Bitcoin. Thanks to The Giving Block, when you donate through the widget, you receive a tax receipt that can lower your tax bill.”, the website claims.
There are also benefits for the charities that receive NFTs. Since cryptocurrency in many jurisdictions is considered an asset rather than a currency, they are not taxed. Any NFT is sold on an Ethereum platform. Hence, proceeds will also be generated in crypto format, giving charities a legal way to skip paying taxes for the donation they receive.
NFTs Raise Money For Non-Profits
Having grown at the backdrop of cryptocurrency fundraisers, NFTs are the new trendy charity platforms. However, unlike cryptocurrencies, they offer a lot more than mere donations.
NFTs have become viable alternatives to fundraisers. They allow charities, celebrities, and individuals to create digital tokens and auction them off, with all the profits directly going to a charity of their choice.
Websites like OpenSea facilitate such sales. For example, Beeple, the artist who still holds the record for the most expensive NFT ever sold, auctioned another NFT for charity. Tech entrepreneur and TRON founder Justin Sun bought the (NFT) for $6 million. The artist donated the proceeds to the Open Earth Foundation to combat climate change.
“NFTs have had a huge impact on the charitable sector. We see a huge increase in donations related to NFTs,” Alex Wilson, co-founder of the Giving Block, said.
Ellen DeGenerous raising $33,495 after auctioned an NFT in April for the World Central Kitchen.
Football Icon Pele also announced that Ethernity Chain had issued an NFT in his honor. 90% of the proceeds were donated to charity.
People post a lot on Twitter about NFTs. It is apt to mention that an NFT version of Twitter’s first published tweet by co-founder Jack Dorsey sold for $2.9 million in March this year. He donated $2,915,835.47 from the sale to GiveDirectly, which sends cash to low-income families in Africa impacted by Covid-19.
While the world may still not get people’s fascination with NFTs, as long as they help in generating donations for charity organizations, we don’t mind them.