When we talk about crypto, we usually talk about investments or trading, but in recent years, it has found a myriad of other uses.
One such use is fundraising for situations where fast, efficient, and traceable transfers are necessary. Fiat currency can take days or even weeks to transact across borders and it can include big fees. Furthermore, it does not have the same element of transparency and accountability that an immutable, blockchain-based financial transaction has.
This has led to the rise of crypto being used in situations such as conflicts and natural disasters, to get funds to people that need them.
Crypto as a concept
Blockchain and crypto as concepts date back to 1982 and have been developed over the years into their current form. Now, digital currencies are being used by central banks, financial institutions, and tech companies the world over.
So fast has been the pace of their adoption, it has left many in spin and feeling rather old as they still count pennies and notes. In fact, the pace of new technology has left many unsure of their technological age compared to their actual age. But in terms of crypto, it is something that is mainly enjoyed by those under 60. In fact, most investors in crypto are under the age of 40, with the number falling significantly between 40-60.
But with mainstream adoption underway and familiarity with situations such as its use in high-visibility fundraising efforts, more older people could seek to use it.
The benefits of donating to the cause in crypto are numerous, including less influence from geopolitical factors and depreciation, security, and the speed of transfers. A donation made in cryptocurrency can be with its recipient in a matter of moments, whereas bank transfers can take days.
Crypto during natural disasters
In the case of a natural disaster such as an earthquake, flood, or drought, often, getting aid and funds where they need to go quickly is a challenge. This is especially true if it is a third country or one that is not well-served by the international banking infrastructure. This is where cryptocurrency comes in.
For example, Hurricane Dorian was one of the strongest hurricanes ever recorded, a Category 5 that struck the Bahamas in 2019. With wind speeds of up to 185 mph, it caused billions in damage and left thousands homeless. This was one of the first examples of cryptocurrency being used to reach those in need. One of the world’s most popular crypto platforms set up a fund which was used to raise money for those impacted by the disaster.
In 2017, an anonymous bitcoin holder decided to donate a significant sum of bitcoin to a man working to alleviate poverty in El Salvador. The “bitcoin whale” as he was nicknamed, gave the money to the project called Bitcoin Beach, which was the country’s first circular bitcoin economy, creating jobs for local people and boosting the local environment.
There is also the case of BitGive, a nonprofit that has been taking crypto donations since 2013. They have used the money to support much-needed relief work in Asia, Africa, South America and North America, typically following natural disasters. They also worked in Nepal in 2015 to clear the rubble after a number of devastating earthquakes that displaced some 30,000 people.
Another use relates to fundraising in conflict situations. For example, in the summer of 2021, US forces withdrew from Afghanistan, and within days, the Taliban had taken control of the country. There was mass panic as many tried to leave the country, and the West struggled to get money and assistance to those left behind.
As banks and financial institutions struggled to remain open, many turned to cryptocurrency as a way to transfer money securely and safely. Apps were set up to allow the purchase of food, supplies, and even tickets and documents, with currencies such as bitcoin.
The use of cryptocurrency as a fundraising tool will help familiarise the population with crypto, thus driving forward its adoption across all age groups.