Blockchain is not only cryptocurrencies, and thus the possibility of earning. Although this technology with Bitcoin and other digital assets is most often associated, its applications are much wider. One of the areas where blockchain can be of great importance is charity and charity. Thanks to its transparency, decentralization and immutability, this technology can help increase the efficiency and credibility of non-profit organization.
Why blockchain?
One of the main problems in charity is the lack of full transparency of funds. Many people are afraid that their donations do not go directly to the needy, and some funds are used for administrative costs or other, not always clear goals. Blockchain can change this, because each transaction recorded in a distributed accounting book is public and unchanging. Thanks to this, donors can track how their money is used, which increases trust in charity.
This is not the end. Traditional methods of transferring donations are often associated with high bank fees, currency conversion costs and intermediaries’ commissions. Blockchain allows direct transfer of funds without the need to involve third parties, which reduces the costs of transactions and allows most of the donation to reach beneficiaries. Smart contracts can additionally automate the entire process, ensuring that the funds will go exactly where they should, according to the previously established conditions.
Added to this is time. Thanks to blockchain, donations can be sent almost immediately and regardless of the state borders. This is particularly important in the case of sudden crisis situations, such as natural disasters or armed conflicts, where quick help can save lives. In traditional financial systems, international transfers can last for several days, and in the case of blockchain, funds can reach the recipient within a few minutes.
Theory and practice
All of the above is a theory. Practice shows, however, that block chains can really help. For example, UNICEF is testing the use of blockchain to collect funds and finance innovative projects working for children. Together with the Jaleshwor commune in Nepal, UNICEF Office of Innovation (OOI) and UNICEF Nepal Country Office, how this new technology can actually help in charity. UNICEF itself also has its own fund worth USD 400,000, whose funds are intended for research on blockchain technology and artificial intelligence. However, this is a more famous organization that uses blockchain, for now in tests. However, initiatives that are worth distinguishing are already in the environment of the block chain.
For example, Building Blocks of the World Food Program in Jordan uses blockchain and with its help helps provide help to 100,000 Syrian refugees who live in special camps. The use of new technology has helped reduce transaction fees by 98%.
The Alice platform, in turn, is based on intelligent contracts that freeze donations for charity until the foundation proves that it allocates them for its statutory purposes. Givetrack, Bitgive, works similarly, which system allows you to track donations – donors can check whether the funds have been spent on a noble purpose.
The Aidchain payment gate is complemented by these initiatives, which allows you to pay non-profit for cryptocurrencies in a safe and transparent manner.
It is worth mentioning on this occasion about Refi, i.e. regenerative finances. It is an idea about investing a responsible way and with concern for the environment – it is about projects that allow regeneration of natural resources. In this part of the blockchain market, there is, among others Impact Dao. It is an initiative that changes the method of financing ecological and social projects. Dao is decentralized autonomous organizations that use blockchain technology that allow you to manage projects a fully democratic way – it is the communities that decide what to do with the funds they have. Their biggest plus is that they allow everyone to participate in them – regardless of living or nationality. Each DAO member has tokens that enable him to vote on funding. Individual projects on the market help, be it in cleaning of plastic water (Dao Ocean Protocol) or protection of urban green (Common Ground).
Let’s look at a few projects from this segment.
Summitshare is a tool for cooperation in the field of digital repatriation and protection of African culture. By digitizing artifacts and their history, Summitshare is aimed at preserving and wider sharing African cultural heritage. The platform, thanks to the innovative use of blockchain technology, “ensures the authenticity and availability of the history of each artifact, making history a living, evolving narrative available to everyone.”
Shamba, in turn, is a decentralized network of monitoring, reporting and verification (DMRV), which provides data constituting the basis for calculating carbon dioxide emissions and other ecological loans.
Rarimo Freedom Tool Systems is an online voting model in which cryptography was used. This allows you to get involved in democracy, but in a safe and transparent way. This is especially important in countries where democracy is threatened.
Achieving sustainable development with blockchain
Blockchain is more and more often talked about in the context of the development of Impact Investing. It is about the concept of ESG, i.e. efforts for environmental and social management, all to achieve the goals of sustainable development. And, interestingly, more and more companies in the world are reaching for these ideas and realistically implementing them. Here again Bitcoin technology appears. According to a study conducted by the International Institute for Sustainable Development (IISD), “Blockchain can increase trust between the parties, promote financial and social integration, improve data collection and accelerate the processes of monitoring, reporting and verification, as well as encourage behavior promoting balanced development“.
An example of the use of block chain in this context is Mining, which is based on renewable energy sources. For example, the Green Hashrate project enables entities that buy bitcoins, check whether the specific ones have been dug using ecological sources. The code even allows you to estimate the carbon trace of each Bitcoin extracted!
It is also worth mentioning the building blocks of the world food program, which in turn allows you to track food payments for refugees. In this context, we also have another element – creating digital identities for each program recipient (in the form of biometric identification). Thanks to this, it is easier to follow whether help actually goes to the needy.
On the market you can also find ESG tokens. Fishcoin is a part of the project that encourages fishermen, fish breeders and distributors to share data about their products at all stages of the supply chain. This helps prevent erroneous labeling of products and facilitates “catching” illegally caught fish species. In exchange for data, fishermen get fishcoins.
Another project, Veridium, helps in converting the compensation of carbon dioxide emissions to Verde tokens. In other words, it is about rewarding entities that choose pro -ecological policy.
Plastic Bank helps in cleaning the environment. His token is part of the Social Plastic program, which involves paying people in developing countries for collecting plastic waste and tokens, which can later be converted into FIAT currencies.
You can read more about such projects at Hodler Club.
Blockchain as a platform for helping
Armed with all this knowledge, we can slowly summarize the topic, indicating why Blockchain is a good choice for charity organizations.
First of all, it provides transparency and unchanging record, which is especially important at a time when many seemingly noble initiatives serve to extort money. Blockchain can help increase the credibility of the foundation. People who want to support some organization can track the flow of funds. In turn, intelligent contracts can additionally authenticate the whole process, automatically sending funds to the needy.
In addition, blockchain reduces operating costs. UBS showed that it reduces the time of delivery of goods for those in need by 96% and reduces costs by 75%.
All this means that various companies reach for new technology. For example, Mercy Corps with a block chain helps farmers in Kenya – it gives them access to the loan system. Bitpes uses blockchain to implement business transactions between Africa and the rest of the world. Banqu helps displaces by registering them in blockchain, which is to help them access the banking system.
Further examples? The Grameen Foundation, in cooperation with Rippsleworks, runs blockchain philanthropic projects. Waterchain monitors water consumption using a block of flats, and Power Ledger reaches for chains to trade in energy generated by solar panels.
Summary
Blockchain can help in the development of the foundation and more broadly: charity. This is because it makes it easier to record data and makes the transfer of values transparent. In addition, the block chains in logistics shorten the delivery time and reduce costs.
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