How to Donate Bitcoin
Crypto is increasingly becoming the preferred currency for charity organizations. Here’s how to donate Bitcoin.
Many charity organizations are increasingly using crypto to receive and disburse donations worldwide. Feeding America, Save The Children, The Water Project, GiveWell, and United Way are excellent examples of the charity organizations that currently accept and issue donations in Bitcoin. Unlike fiat currencies, Bitcoin offers enhanced transparency and accountability, with prompt payment processing that enables charities to assist those who need it on time.
Bitcoin’s blockchain technology makes it easier for aid providers to track the movement of funds in real-time, thereby reducing cases of corruption and other financial malpractices. Besides, the blockchain can also execute smart contracts, allowing charity organizations and donors to stipulate the funds’ recipients and usage, ensuring greater convenience and accountability.
Charity organizations also increasingly use Bitcoin because of its relatively lower transactional costs. Compared to traditional remittances, Bitcoin facilitates seamless cross-border transactions at much lower fees than bank transfers or credit card payments. The IRS classifies crypto donations as property exempted from capital gains tax. That means the charity will receive the total value of your donation.
Besides, the beneficiaries do not have to exchange the donated Bitcoin into local currencies to use them. Many businesses now accept Bitcoin as a payment for various goods and services. Bitcoin enables underprivileged populations to access capital and transact without political or institutional interventions as a decentralized currency.
Sending donations in crypto also comes with greater autonomy than fiat money. Bitcoin is a peer-to-peer network that allows users to transact without revealing their information to any third party. That is important in cases where donors may not want to reveal their identities. The absence of third parties and regulatory restrictions in Bitcoin transactions also gives the charity organizations the freedom to manage their donations effectively.
How to Make a Donation in Bitcoin
Bitcoin donations also follow an almost similar procedure to that of fiat currencies. However, a few disparities that you should know exist. The following is a step-by-step process on how to donate in Bitcoin.
Find out the Organizations that Accept Crypto
While many charities now accept donations in crypto, some still have reservations for various reasons. Thus, you should first check whether the charity organization you want to donate to accepts Bitcoin.
Open an Account with a Broker
Every Bitcoin user has a public address and private address generated after opening an account. So, create an account with a reputable crypto exchange such as Bitcoin Era. That will enable you to buy the required amount of Bitcoin for donation.
Choose How You Want to Donate
One of the benefits of using Bitcoin to donate is submitting the funds anonymously. Alternatively, you can also share personal details like names and contacts with the charity organization before presenting your tokens. Nevertheless, Bitcoin transactions only show the users’ public addresses, without direct ties to their real-world identities.
Get the Recipient’s Address
As hinted above, Bitcoin users identify themselves using their public addresses. The address is like the account number where you will send the funds. So, make sure you also get the correct public address of the charity organization.
Depending on your preferences and requirements, you can submit the funds from your wallet to the charity organization’s address directly or through a broker. However, a crypto exchange will come with additional costs since they usually charge a small fee for processing transactions. Thanks to the blockchain, you can also include instructions on how you expect the charity organization to use the donated funds.
Bitcoin is undoubtedly the future currency, promising to revolutionize financial transactions. Its rapid adoption by charity organizations is proof of its immense potential to improve the management of donations.