Médecins Sans Frontières trialled accepting donations in cryptocurrency and reported back on the results at the FIA Conference 2022 in Sydney.
It seems everywhere you go these days, crypto is there – as a topic of discussion, as a meme, as a form of payment. But have you ever considered accepting donations through crypto?
Médecins Sans Frontières (MSF) did – and ended up accepting what’s believed to be the world’s largest charity donation received from the sale of a non-fungible token (NFT).
Before an engrossed audience at the FIA Conference 2022 in Sydney, Matthew Jones, major donor senior relationship advisor at MSF Australia and MSF New Zealand, explained that the NGO had conducted extensive research into accepting cryptocurrency donations before deciding to set up a system to allow them.
Based on ATO estimates of around one million Australian crypto investors, with the majority of users aged between 18 and 44, MSF identified an untapped market of potential future donors and investors.
“We identified this as a great method for finding young, educated and possibly wealthy individuals,” Jones explained.
The organisation assembled a team of people with different skill sets to approach the problem of how to attract crypto donors. They had two objectives: to test the new market, and to do so in the most cost effective way possible.
Jones told the audience that the first step was to conduct due diligence and assess all possible risks involved in the project. It was also vital to find the right platform for the project. There are many forms of cryptocurrencies on the market and many ways in which they can be transferred or used. As part of the due diligence process, MSF found three key risk areas: due diligence, privacy and climate change.
On the due diligence front, large crypto donations could trigger the concerns of governments or watchdogs for potential money laundering or criminal activity. But Jones said that through proper checks and tracking, MSF found that this risk could be mitigated.
“We determined that the risk of accepting illegal income is no greater with crypto than current banking systems. And in fact, crypto is the most traceable currency,” Jones said, adding that MSF would have the power to request more information about a transaction, or turn off its acceptance of crypto donations if needed.
To maintain privacy, MSF opted to use cryptocurrency exchange Gemini, which separates data from the giver and the recipient to ensure privacy.
On climate change, MSF acknowledged that cryptocurrency mining has “serious energy implications”. But Jones said the industry is moving to be “less resource intensive”, with some prominent currencies like Bitcoin now relying on more renewable energy sources.
“Many users are extremely green aware, and they advocate for reduced environmental impacts and they actively choose energy suppliers that align with that,” he explained.
After investigating crypto donation platforms, MSF opted to go with The Giving Block and signed up for a premium membership which means the NGO is marketed to Giving Block donors who may be interested in donating. Users then make a donation using their crypto wallet, and Gemini runs compliance before allowing or disallowing the transaction.
Once MSF receives the funds, any donor details are input into the organisation’s database – though Jones acknowledged that a major challenge is that many crypto donations are made anonymously.
To market the new initiative, Jones explained MSF undertook an awareness-raising campaign. Using the demographics noted during its research, the organisation identified a target demographic of cryptocurrency traders and marketed advertisements across display, Twitter and streaming service Twitch. With a high rate of impressions and click throughs, the campaign was taken to be a success.
Unfortunately though, it didn’t result in any crypto donations during the campaign (donations totalling $912 were received prior to the campaign). MSF was able to determine that timing was a factor in the campaign failing to inspire any donations, with the price of cryptocurrencies fluctuating during the campaign.
But in September 2021, MSF received a donation of just over $4.7 million from a NFT project. The donor left a message, stating how much they admired MSF’s activities and mission – proving that purpose is still vital in connecting with crypto donors.
— MSF Australia (@MSFAustralia) October 12, 2021
Going forward, Jones said MSF was exploring ways to raise its profile as a recipient of crypto donations, including participating in a crypto philanthropy day online.
As an early adopter of the technology in the Australian charities market, Jones said MSF now had strong networks in crypto innovation to begin looking into new opportunities in the burgeoning cryptocurrency market.
The information shared was for general information only and should not be taken as constituting professional advice.