Donations in cryptocurrencies are increasing rapidly. Charities are showing more interest in accepting donations in digital assets. The U.S. tax legislation is sympathetic to many individuals. Who were enriched by digital currency and now allow these individuals to make cryptocurrency backed donations. Donors are getting the benefit of deductions on their tax returns filed by giving assets rather than cash, along with no pay on capital gains to the government.
Many individuals have accumulated massive capital gains by cryptocurrency. Due to the vigorous rise of cryptocurrencies like Bitcoin and others with above average bonuses, the U.S. Government has incentivized people to donate their digital assets rather than the hard cash or a cheque.
The Silicon Valley Community Foundation is one of the biggest charity organizations in the U.S. holding cryptocurrency donations.
Donations in cryptocurrencies are increasing rapidly.-As per the article in ‘International Business Times’, the foundation’s annual financial report revealed almost $4.5 billion in digital assets like Bitcoin and Ether. Another charitable organisation, Fidelity Charitable, also shared that they were increasingly receiving donations in cryptocurrency during 2017. This organisation ranks number one in the U.S. in terms of receiving donations each year. There many charities which exclusively focus on receiving digital currency donations. Some of the organisations are motivating individuals to donate their sluggish computing capacity to mine cryptocurrency.
For example UNICEF Australia is a typical charity which allows visitors to their homepage to mine monero in their browser which is directly linked to projects supported by them. Similarly, Change.org has a screensaver which mines cryptocurrency for charity, when users are logged out from their computers.
Emerging Asset Category
The report vigilantly alerts these organizations that accepting donations in cryptocurrency is as risky as investing in the emerging asset category. The scale of damage due to market crashes will become apparent as financial reports are published yearly.
Other issues experienced by the charity organizations like were: lack of knowledge to convert digital assets to hard cash, and a decrease in the value of donations received in latter part of the year 2017 than the donors wanted there to be.