A blockchain is a secure and unchangeable database of information that is stored across a vast, peer-to-peer digital network that verifies and locks in every transaction. While Bitcoin is the best-known use of a blockchain, it is also being used in a variety of other ways to further social good. Here are some of them.
Here’s everything you need to know about the newest frontier in fundraising and giving.
GiveTrack
The BitGive Foundation, which called itself the first Bitcoin nonprofit when it was founded in 2013, is running a pilot of GiveTrack, a crowdfunding website that uses blockchain technology to show donors how their cryptocurrency donations are being spent.
GiveTrack, which is working on projects in Africa and Asia, can in essence watch Bitcoin move from its donors’ wallets to the vendors, currency traders, charities, or beneficiaries it’s intended to support. It then interprets that public-ledger data and sends reports, often along with photos and other materials, to donors watching the progress of the project they supported.
So far, it has funded four projects, including one to bring a clean-water source to a school in Kenya, with about $30,000 worth of Bitcoin gifts.
Caterina Rindi, a Bitcoin donor, says GiveTrack is “opening up the opaque process of how charitable funds may be applied and giving better clarity to donors.”
Gift Coin
Similarly designed with the idea of demonstrating to donors how their money is being spent, Gift Coin is working with the online gift processor Network for Good on a pilot program to test how the blockchain can facilitate payments when a charity project reaches milestones.
The program is designed for nonprofit projects in which support is doled out in phases, tied to the project reaching a goal or milestone. When a goal is met, the charity uploads evidence to the network; donors then vote on whether to validate the results. If enough donors vote yes, then the next phase of support is automatically released.
GiveCrypto.org
Launched in June by the leaders of Coinbase, a digital-currency exchange, the organization plans to give cryptocurrency directly to impoverished people abroad who do not have access to banks or basic financial services. By connecting them with the open financial system of the blockchain through their cellphones, GiveCrypto says it is building a decentralized network for distributing charitable donations. Included in its plans is an app that will allow donors to make gifts directly from their Coinbase wallets. The group has so far raised $4 million worth of Bitcoin and other cryptocurrency.
Social-purpose coins
Blockchain technology allows anyone to create a currency. A number of currencies, called altcoins or tokens, have been developed with a focus on philanthropy. RootProject, for example, has a crowdfunding platform where a small percentage of each gift to charity projects is used to buy Roots tokens, which RootProject introduced in an initial coin offering earlier this year. Buying Roots is meant to support the value of the tokens, which are used to fund savings accounts for low-skilled workers involved with the projects.
Pinkcoin, another digital currency, incentivizes cryptocurrency miners to share the rewards they get for their work. Pinkcoin says that at least $1,500 a month flows through its Donate4Life program to participating charities in the United States and Canada.
Another group, called impactMarket, says it will soon be starting the private sale of its new currency, IPCT, which will be aimed at investors and businesses interested in supporting charities through such activities as online auctions, sweepstakes, crowdfunding, and matching-gift efforts.
Blockchain for Social Good
Blockchain for Social Good is IBM’s effort to use the platform the company has developed for blockchain technology in the service of humanitarian efforts. It has worked on projects to turn carbon credits into a new digital asset and create a system for impoverished people to earn cryptocurrency in return for collecting cast-off plastic items for recycling.
Earlier this year, IBM teamed up with Global Citizen, an international anti-poverty advocacy group, to sponsor a contest challenging people to create a donation-tracking application on IBM’s blockchain platform. It has also worked with Charity Navigator testing ways to use the blockchain not only to track donations but to optimize the operations of nonprofits, such as helping hunger-relief charities provide food where the need is greatest.
