Blockchain technology is considered a revolution in the way we handle governance and economic value. Now it could also change the way we handle charitable giving and philanthropic activities. The transparency and trustless nature of the distributed ledger could be a perfect fit for crowdsourced charitable ventures and community projects.
Here’s a look at some of the ways blockchain technology and the immense wealth created in this sector is benefiting the most vulnerable people and countries.
Ethereum-based refugee support
The UN World Food Program (WFP) has been using the Ethereum blockchain for its assistance programs since 2017. At the height of the Syrian refugee crisis, the UN decided to implement an identification system on the Ethereum network to ensure refugees staying at camps could access essentials such as food, water and clothing.
The system was first implemented at Jordan’s Azraq camp, where 10,000 refugees used the online application daily. As of 2018, more than 100,000 refugees across the world are part of this blockchain-based program.
Philanthropic efforts face a critical deficit of trust. Bad actors have used non-profit outlets to acquire wealth or political gains. Meanwhile, inefficient charities have been known to spend more on administration and logistics than their core mission. This means the average donor is sceptical of where her money is going. One-third of Americans and roughly 60% of the global population doesn’t expect charitable groups to accomplish their mission or spend donated money efficiently.
A distributed ledger could change that. Asia’s Lane Crawford Joyce Group (LCJG) partnered with the ConsenSys Social Impact group to launch an online platform that allowed users to track their donations for specific causes. The LUXARITY project is an early example of how blockchain technology could make philanthropic ventures more transparent and trustworthy in the future.
Play-to-earn is the latest blockchain innovation that’s changing lives. These decentralized games have created a new avenue for earning money remotely. That’s been popular in developing economies across the world.
Axie Infinity is the best example of this. The game’s playable characters are NFTs based on the Ethereum network. Players can accumulate points on the game that have real-world value. They can also lend NFT characters, sell in-game services and breed new characters to flip into the marketplace for supplemental income. In countries like the Philippines and Venezuela, income from Axie Infinity outpaces the local average wage.
Traditional payment processors charge high fees for recurring transactions. That causes friction for charitable ventures trying to collect regular donations. Smart contracts based on blockchain technology could change that.
Save the Children is a trailblazer in this space. The organization has been accepting crypto donations since 2013. Now some of its programs allow donors to make recurring donations in any one of several different cryptocurrencies. The organization even accepts NFT donations to support its efforts to curb child hunger and poverty.