Since its introduction in 2009, bitcoin transactions have risen exponentially, gaining traction around the globe.
One of the reasons this peer-to-peer transaction is so popular today is because cryptocurrencies can’t be created, regulated, valued, or distributed by any government or central bank in any part of the world.Â
There’s no interference from a third party, and no one has the authority to put your coins on hold, charge you, or demand that you return them.
Additionally, they can’t be stolen, don’t require disclosing confidential information, and can’t be seized by the government under any circumstances.
The perks of making payments with bitcoin, combined with the assurance that the system will protect its users’ rights, make bitcoin the first truly international currency.
Organizations Jumping on the Trend
Over the years, the number of charity organizations accepting cryptocurrency donations has been rising due to the fluidity of payments when using various online currencies.
Accepting digital currency donations is proving to be the ideal option for groups whose fundraising efforts have been hampered by COVID 19 and the year 2020 in general.
The money generated from these online wallets helps to promote charitable activities worldwide, and many NGOs have reaped significant benefits since they joined the trend.
You can donate bitcoin or other digital currencies to nonprofits to accomplish social good, whether you’re a philanthropist or wish to create some positive change in the world.
Here are four benefits people experience when making bitcoin donations to nonprofits:
1.It’s a Fast and Inexpensive Way to Donate
Bitcoin, like the Internet and e-mail, is not geographically restricted and travels fast.
One great advantage of giving to charities using bitcoins and other cryptocurrencies is that these online currencies only take a few minutes to reach their destinations, regardless of the amount sent.
Unlike debit and credit card transactions requiring a go-between agent, making payments with bitcoin doesn’t necessitate authorization requirements making the transactions occur quickly.
Also, making payment to a different part of the world through your bank can be pretty expensive, but when done in bitcoins, the charge is either insignificant or non-existent.
While traditional wire transfers and international payments sometimes have hefty fees and exchange expenses attached due to the presence of intermediaries, bitcoin transactions do not involve a third party, resulting in low transaction fees.
That said, if there’s a charity organization you would like to support with any amount of money, you don’t have to worry about the transaction gulping a considerable amount of your time or a negative charge, as bitcoin technology prevents all that.
2.It’s Anonymous, and There’s No Fraud Risk When Donating With Bitcoin
Suppose you want to donate Bitcoin to charity, you don’t have to worry about the possibility of being defrauded because bitcoin allows senders to conduct transactions without providing any sensitive personal or financial data to recipients.
While transactions involving credit and debit cards require users to input personal information in a web form, people who use BTC benefit from anonymity because all their information is kept private and preserved utilizing blockchain technology.Â
BTC’s protection safeguards your financial history and secures you against the risk of account or identity fraud, which is more likely to occur under the traditional banking system, which could expose your information at any stage in the transaction chain.
The bitcoin address provided for payment is confidential and changes for each transaction made by the same user.
In addition, bitcoins are similar to digital cash, in that to a large extent, hackers are unable to obtain them or uncover your identity. This protection goes a long way towards preventing specifically targeted data intrusions.
Undoubtedly, BTC’s anonymity is a significant benefit for charitable individuals concerned about protecting their personal information when making cryptocurrency donations.
3.Donating to Charities That Accept Bitcoin is Relatively Easy
For many users, a digital wallet for holding cryptocurrency is far more accessible than a traditional bank account, which is why many individuals have lauded cryptocurrencies’ promise of greater financial inclusion.
Anybody from any part of the world, at any age or time, can make a bitcoin donation to charity as long as he or she has a reliable internet connection. You don’t have to worry about holidays or strikes when operating an online wallet.
More so, having a bitcoin account does not require the provision of an identification card, passport details, or proof of address which regular banks demand.
All you have to do is download a bitcoin wallet application on your smartphone or computer and generate a bitcoin address to facilitate online transactions.
So whether you’re an eighteen-year-old high school student looking to put a smile on an underprivileged child’s face or a new resident of any given country worldwide, you can conveniently operate a bitcoin account and donate to a charity that accepts bitcoin that is meaningful to you.
4.Donations Using Cryptocurrencies Attract Tax Benefits
Bitcoin’s recent parabolic price rise has created some intriguing opportunities for nonprofit organizations and their donors.
Making donations to charity organizations in bitcoin is usually tax-deductible in many countries. Furthermore, bitcoin donations assist donors in lowering their tax requirements while also helping organizations whose goals are essential to them.
Because the IRS considers Bitcoin and other digital currencies to be property rather than currency, taxpayers could reduce their tax bill by donating bitcoin rather than fiat currency.
If you try transferring first to another cryptocurrency or fiat before donating, you could lose the full tax benefit, unlike when you send bitcoin directly to a nonprofit.
This tax-saving mechanism is enabled by Internal Revenue Bulletin 2014-16, in conjunction with the rules for donating appreciated property in IRS Publication 526.
Because of the IRS’s provision, donating virtual money to a charity that accepts bitcoin, such as Food For Life Global, allows taxpayers to avoid capital gains tax while also receiving a tax deduction at higher regular income rates.
That said, if you intend to donate for tax purposes, you can consider speaking with your tax agent to gain a greater understanding of the procedures involved.
