Fidelity Charitable, the second largest grant maker in the USA, has created a possibility for everyone to donate in bitcoin. Donors can now use the cryptocurrency to support charities. This novelty actually expands the existing range of assets they can contribute to.
However Fidelity Charitable isn’t the first fund to turn to bitcoin. Indeed it has followed United Way Worldwide, the country’s largest charity, and the American Red Cross – two fundamental organizations which already accept bitcoin.
Fidelity Charitable is an independent donor-advised fund founded in 1991. It has already enabled donors to support more than 210,000 nonprofit organizations with more than $20 billion in grants. The mission of the organization is to continue the American tradition of philanthropy by providing programs that make charitable giving simple and effective.
Investors can donate in the following way: they contribute to their accounts and the fund distributes the money in accordance with its choice. So far most of contributions have been made in such capital assets as publicly-traded securities, private business shares and real estate.
It is really expensive, time-consuming or even nearly impossible to accept for many nonprofits. Now charities get the possibility to receive checks or electronic funds transfers from Fidelity Charitable which considerably facilitates the whole process.
Matt Nash, senior vice president of donor engagement for Fidelity Charitable, explains: “There’s more and more people investing in digital currency, and we felt like donors would want to tap into their digital wallet. For us, it’s far enough along in its maturity that it was something we wanted to consider taking in.”
Coinbase Inc., a San Francisco-based bitcoin wallet and exchange company, acts as a partner of Fidelity Charitable. It will convert bitcoins into cash.
Donations in bitcoin are relatively low yet. Nick Tomaino, a spokesman for Coinbase, sees the reason in the currency itself. Most people own the currency as an investment and tend to hold their funds. Moreover the price is mostly flat.
“Enabling donors to contribute bitcoin to their donor-advised funds is the latest example of Fidelity Charitable’s commitment to making it as easy as possible for donors to support the charities they care about with the assets at their disposal,” says Matt Nash. “There are many tax advantages to donating long-term appreciated assets, and that ultimately means more money to charity.”
Hopefully this noble initiative will contribute to the reputation of bitcoin. It’s not a secret that the cryptocurrency, created seven years ago, has been widely used by criminals. The thing is that the very nature of bitcoin provides anonymity for parties as transactions don’t go through the traditional banking system.