FundSvcs Community

Expand all | Collapse all

Accepting bitcoin

  • 1.  Accepting bitcoin

    Posted 7 days ago
    Hello! I am curious to know if anyone is accepting bitcoins. If so, are they incorporated into the bylaws/gift acceptance policies? Do you use a consultant to process it? How do reconcile it?

    Many thanks in advance,
    Marta


    ------------------------------
    Marta Kostrzewa
    Finance and Administration Manager
    Pratt Institute
    mkostrze@pratt.edu
    ------------------------------


  • 2.  RE: Accepting bitcoin

    Posted 7 days ago
    Accepting Bitcoin and other cryptocurrencies is not that difficult.  You mostly need to work with your CFO and select and interface a crypto wallet with your financial institution.

    For gift acceptance policies I write, I reference nearly identical processes as for securities contributed via DTC.  The IRS has ruled virtual currency is a form of property, so those procedures line up nicely both for valuing and receipting.

    Interestingly, while I receive many inquiries from nonprofit organizations who have donors "thinking about" donating cryptocurrency, rarely do donors end up moving forward!

    Here is a pretty good guide to some available wallets.  My only advice is to not get one that only handles Bitcoin.  There are many other forms of virtual currency and you should be prepared to handle most of them.  While this article mentions Bitcoin, most accept other forms:


    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987






  • 3.  RE: Accepting bitcoin

    Posted 7 days ago

    Hi All,

    We periodically run test gifts through our website to observe "user experience". I recently made a test by making a donation on our website and decided to pay using Paypal. When I got to the Paypal site I saw the option to pay using Bitcoin. Paypal users who have purchased cryptocurrency can use it for donations or payment. Paypal converts the bitcoin to USD and the donation came through to Cross Catholic Outreach as "Paypal" but no different than donations paid through Paypal by CC, Debit, or ACH.

     

    Rhonda Gonsalves

    Donor Operations Senior Manager

     

    Cross Catholic Outreach

    2700 N. Military Trail Suite 300 PO Box 273908 Boca Raton, FL 33427-3908

    561-392-9212 ext. 127

    CrossCatholic.org   Twitter Facebook LinkedIn

     

    Delivering Food, Shelter and Hope to the Poorest of the Poor

     






  • 4.  RE: Accepting bitcoin

    Posted 7 days ago
    Accepting crypto is not hard, but there are some caveats and issues to consider, and to include in a gift policy.

    1. Valuation - while crypto is property, and you can treat it like a security, in practice you have other options that are easier to manage. Some wallets will accept the crypto and convert it to cash right away, much as a broker would do for a stock. However, unlike a broker, these wallets will guarantee you the exact amount of value in USD that the crypto had at the moment it was donated. As a result, you can receipt the donor for that amount, which represents the FMV, instead of the hi-lo of the market on the day of sale. There will never be a delta between the amount donated and the amount receipted, which is always a relief, especially when dealing with pledge fulfillment! 

    2. Vetting donors who wish to make large crypto donations is probably a good idea. You're much more exposed to donors with criminal or just unsavory business entanglements. Your acceptance policy is a good place to add this caveat.

    3. Some cryptocurrencies are horrible for the environment in terms of their energy costs. Proof-of-Work currencies, eg BitCoin, require a LOT of energy, whereas Proof-of-Stake currencies do not. You may wish to accept coins that align with your institution's values. At least one major PoW coin, Etherium, has plans to migrate to Proof-of-Stake because of these concerns.

    4. Crypto is not just money. Ethereum and others are increasingly being used to represent physical and digital goods, including fractional ownership of these goods. These are 'tokens', rather than coins. The art world is currently experiencing a boom in the use of these tokens (NFTs), and so you may encounter crypto first with donations of fine art and collectibles, rather than as currency substitutes.
    Crypto has some pretty clear applications for nonprofits, particularly with regards to grants, pledges and creating automated pledge-fulfillment methods through smart contracts connected to coins. There are also opportunities for sponsorship in the NFT space that are tantalizing. It will be interesting to see what develops!



    Thank you,
    Isaac Shalev
    CRM Expert
    Sage70, Inc.
    (917) 859-0151
    isaac@sage70.com

    Schedule a 30-minute consultation now:







  • 5.  RE: Accepting bitcoin

    Posted 5 days ago
    Thank you everyone!

    We hope to talk to a few organizations that are accepting bitcoins.  Is anyone interested?

    Marta

    ------------------------------
    Marta Kostrzewa
    Finance and Administration Manager
    Pratt Institute
    mkostrze@pratt.edu
    ------------------------------



  • 6.  RE: Accepting bitcoin

    Posted 5 days ago

    Many of the campuses in our system are exploring cryptocurrency but none have moved ahead with accepting it yet. That said, I'd love to follow any emerging best practices in this space. Would you be willing to report back what you learn?

     

    Elina

     

    signature_57558027

    Elina Gorelik

    Associate Vice Chancellor for Advancement Operations

    205 East 42nd Street, New York, NY 10017

    Tel (646) 664-3002 | Fax (646) 664-2965

     






  • 7.  RE: Accepting bitcoin

    Posted 5 days ago
      |   view attached
    All, I cannot emphasize how really simple preparing to accept virtual currency is.  The only difficulty is in getting your Business Office to work with you rather than throwing up roadblocks.

    Well, and then getting donors actually to move forward with a donation could be a hurdle.  The latest estimates have only 10% of the public owning virtual currency (compared to 55% owning securities).  So, while having the ability to accept is a nice thing to do, it's certainly not mainstream - yet.

    Attached is a copy of the Powerpoint Sean Vincent, Erin Shy, and I did at aasp Summit seven years ago.  Perhaps it will provide a few answers to your questions.

    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987





    Attachment(s)



  • 8.  RE: Accepting bitcoin

    Posted 5 days ago

    Thanks, John!

     

    You hit the nail on the head: setting up a virtual wallet is the easy part. Getting the Business Office to play ball is the real challenge. Hopefully as more and more institutions establish policies and procedures around cryptocurrency (even if the actual transactions remain very rare), that will provide further comfort for our colleagues outside of Advancement.

     

    Elina

     






  • 9.  RE: Accepting bitcoin

    Posted 5 days ago
    It's interesting that in just one day we have hit upon two giving strategies the Business Office seems either perplexed by or opposed to.  I recall having similar conversations at Duke University thirty years ago regarding recurring credit cards and accepting Discover :-).

    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987