Why charities and NFTs are natural partners

In Ukraine, an NFT auction raised more than $54 million from global human rights activists to help fund the nation’s defence against Russia. In South Africa, a wine once coveted by Napoleon found new prominence while being sold as an NFT, giving wine connoisseurs a newfound ability to track key details regarding its vintage. Meanwhile, a Pakistani-led team is using its Women Rise NFT collection to unite women’s rights activists and visual artists across the globe. 

All around the world, organisations are leveraging NFTs to bring people together around shared purposes and interests. As charities work to build support around their own social missions, they too are beginning to utilise blockchain in surprising and novel ways. In particular, web3 partners are helping non-profits stand out in a crowded marketplace, bring new demographics of donors into their ecosystems, and encourage sustainable community building amongst their donors and other key stakeholders.

“NFTs can help extend their support.”

— Jane Curtis

Today’s philanthropy landscape is crowded. Even as social media has given non-profits access to a nearly unlimited audience of donors, it has also created intense competition for attention with other charities worldwide. Standing out remains critical for any charity hoping to make its mark, but the stakes are far higher. Those that can utilise NFTs, both as a cultural signifier and as a way to raise funds, have a major advantage.

“Charities really struggle with retaining their supporters,” says Jane Curtis, a fundraising and leadership consultant with decades of experience in the non-profit sector. “NFTs can help extend their support.”

Consider Edinburgh Dog and Cat Home (EDCH), an animal welfare organisation based in Scotland. In 2022, the non-profit partnered with the Moon Cats Rescue web3 community, running an NFT fundraising auction that raised £87,000 to support key initiatives. The fundraiser was a major success, in part because it was able to leverage the charity’s non-profit experience with the web3 project’s blockchain expertise.

“The best partnerships are where the project can help you navigate the crypto world and where you can help them create a better society,” says David Mitchell, EDCH’s Digital Fundraising Manager. “A huge, overwhelming portion of our success comes from the crypto projects we have worked with. Partnership is everything.”

Implementing NFTs into a non-profit’s operation won’t just help it to stand out — it also gives it access to an entirely new generation of givers. In fact, Fidelity Charitable report that American millennials give more than double to charity, compared with older generations. That is, in part, due to how each generation sees its role in society: in the USA, 74% of millennials identify as philanthropists, compared to just 48% of Generation X and 35% of Baby Boomers. The trend is reflected on both sides of the Atlantic: 81% of British millennials and younger generations donated to charity in 2021, while only 62% of those aged 40 and above did the same.

Save the Children has effectively used NFT fundraisers and cryptocurrency donations to unlock new supporters since they began accepting Bitcoin in 2013. “The audience is totally different from our core donor base: it is skewed male, and it’s younger,” says Linda McBain, Chief Digital Officer at the children’s charity’s UK arm, noting that Save the Children teams from Italy to India have been actively exploring the opportunity.

In doing so, Linda explains how the charity has been able to access donors in locations that previously were not focused upon. “We are also seeing donations coming from countries where we don’t have such a significant brand presence, but where donors may have found us through our engagement with web3 communities.”

When non-profits reach out to web3 communities, they aren’t just unlocking a new cohort of potential donors and patrons — they are also introducing themselves to organisations that are particularly interested in building around a shared purpose, a demographic that naturally encourages sustainable community building.

“People buy NFTs as a mechanism for them to express what they believe in, what is an extension of them, and what they want the world to know about them,” as Sanchan Saxena, the Vice President of Products at Coinbase, noted in an interview with NFT Now. “NFTs can reflect you being a part of that community.” If charities can incorporate NFTs with a clear understanding of their potential, they stand to gain a more loyal giving base.

That potential is of key interest to Inna Modja, a UN Climate Ambassador and Head of Philanthropy at World of Women, whose members have collaboratively donated over $1 million to charities supporting women’s rights initiatives. “We want to create a bridge between digital communities and communities in real life, fighting for things that are really important.”

“We’ve been able to do more with digital communities than in real life, and faster,” she tells Culture3, noting that she has seen the very act of purchasing an NFT change people’s behaviour in not just their digital life, but their real life as well — in one case, leading a peer to start recycling more after joining a climate focused NFT project.

“We want to create a bridge between digital communities and communities in real life.”

— UN Climate Ambassador and Head of Philanthropy at World of Women

One of the most inspiring examples of web3 activism comes from Geena Dunne, the founder of Honey Badges, a community-led funding initiative. With a community of 880 people, Honey Badges gives every NFT holder a say in its structure and operations. Every three months, members elect a 10-person committee to vet grant applications, who then curate their decisions with the rest of the community.

Honey Badges has been able to organically create a community of donors who vote together on how funds are allocated, and then work together to make sure those projects are a success. And in some cases, recipients of the community’s awards — which have helped fund an arts centre for refugees in Uganda and an indigenous academy in Australia, among other things — have remained active in the community’s conversations long after, through their NFTs.

That connection, through their shared NFTs, has allowed community members to later draw on the expertise of a truly distributed operation. “You are being brought into a global community,” Geena notes. “It’s a level of support and practical access to skills and volunteers that you wouldn’t otherwise know existed.”

The potential for NFTs and charities to partner hand in hand will only increase with time. Consider current charity auctions, which sell valuable items to donors for a one-time cost. If those same items were sold as NFTs, they could be encoded with smart contracts that automatically transfer a portion of the item, when resolve, to the charity, like a royalty.

“You are being brought into a global community.”

— Geena Dune, founder, Honey Badges

As the NFT, perhaps a cherished memento, a historic item, or signed sporting memorabilia, changes hands, it not only generates more funds for the charity, but also raises awareness for the cause itself. 

Integrating NFTs into a charity's fundraising strategy is no easy process, both in terms of the strategy required and the technical expertise to execute it. But the charities which are first to do so will benefit most from tapping into the web3 opportunity.

To learn more about how we think charities can prepare for the future of the internet, read our Culture3 report, Unlocking Opportunity for Charities in Web3.

“The best partnerships are where the project can help you navigate the crypto world and where you can help them create a better society.”

— David Mitchell, Digital Fundraising Manager, Edinburgh Dog and Cat Home