Donating Cryptocurrency: What You Need to Know

We’ve seen cryptocurrency in the news recently as Bitcoin’s latest “halving” took place earlier this month. This halving event (a “scheduled reduction in the number of new Bitcoin that go into circulation”) is speculated to boost the price of Bitcoin significantly, if not immediately. This may also lead to a rise in the prices of other digital currencies.?

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Cryptocurrencies are continuing to gain traction among investors—particularly young investors—and prices continue to rise.?

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Along with this comes increasing interest in donating digital currencies.?

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“Crypto philanthropy” is likely here to stay. Do you know how cryptocurrency might fit into your generosity plans??

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Cryptocurrencies are gaining value as they rise in popularity.?

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• Roughly 580 million people have invested in crypto. Boston Consulting Group projects that number will rise to 1 billion investors by 2030.?

• About 16% of all Americans have used a cryptocurrency.?
• Digital currencies are especially popular among millennials. The average crypto investor is about 38 years old.?

• The price of Bitcoin, one of the most popular cryptocurrencies, grew 153% in 2023 alone. Its price has grown 14,021% since 2016.?

• Others are also taking off. See information about the top 10 here: https://www.forbes.com/advisor/investing/cryptocurrency/top-10-cryptocurrencies/??

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Crypto philanthropy is gaining traction.?

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• One popular crypto fundraising platform, The Giving Block, processed $125 million in cryptocurrency donations in 2022, up from $69 million the previous year.?

• This is just a portion of the crypto donations made in recent years. The Giving Block estimates that over $2 billion in cryptocurrency has been donated to charitable causes.?

• 56 of the top 100 U.S. charities accept cryptocurrency donations.?

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That last number is striking. If nearly half of the country’s best-funded nonprofits have not yet established systems to accept crypto donations directly, it may be a while longer before smaller Christian ministries are set up for this.?

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This is why donor advised funds are such key tools.?

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A DAF is already set up to receive non-cash donations, meaning that kingdom-minded crypto investors can support their favorite ministries with their appreciated investments right now—without requesting cutting-edge, continually-changing technologies from the ministries they wish to help.?

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The Signatry’s DAFs currently accept 96 different digital currencies. You can see the full list via our website. As soon as any of these currencies is contributed to The Signatry, it is liquidated right away, and the cash proceeds will go to the donor advised fund’s balance.?

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You may also get a tax benefit for donating cryptocurrency.?

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Selling crypto is a taxable event (although many investors do not realize this!). The IRS treats crypto donations like other appreciated, non-cash gifts. Just as with stocks and other assets, donating appreciated cryptocurrency before liquidating it can reduce your capital gains taxes and increase the cash available for granting in the DAF.?

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As technologies advance and more investors expand their portfolios to include digital currencies, donors and nonprofits alike can benefit from keeping up to date on the best ways to donate crypto to support God’s kingdom work.?

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Questions? Learn more on our website: https://thesignatry.com/asset-giving/cryptocurrency/