In the present day, technology is growing per day and with that, the use of digital money is also increasing. Many big charitable trusts accept bitcoin and many other cryptocurrencies as the donation. The cryptocurrency is the volatile form of digital money which is accepted by various charities despite being entrusted with managing and accepting fund benefits for public. Being the professional in tax and financial issues of charities face, we spend good time examining what could go wrong as the final result with non-profit dabbling.
To understand the benefits of digital money as a donation, take the example of Silicon Valley Community Foundation which is known as one of the country’s largest charities. According to the annual financial statement this charity held near about $4.5 billion of digital asset per year which is one-third of its US $13.5 billion investment. This charity generally holds more cryptocurrency as comparison to any other charity. One of the most popular charities of US, the Fidelity Charitable says that the digital money gets it’s fastest growth in the year 2017.
Many other charities in these days, start accepting donations in bitcoin and other kinds of cryptocurrencies for greater profit. The market of these new-fangled assets grew with the starting of digital money surged in the year 2017.
The bitcoin is the most common form of digital money. The value of bitcoin is raised between the years 2017 and 2018. As per a study, the value of this most common cryptocurrency rose by 1318 percent in 2017 against the US dollar.
The XRP is referred to as a second most common form of digital money which gains growth in the early 2017 and mid 2018. This kind of cryptocurrency gain 36018 percent over the year.
These gains give way to high losses in starting few months of the year 2018 because the digital currencies rushed sharply in this year. Some of the charities that get high amount of cryptocurrency donations in 2017 found many difficulties to convert them into cash. It is necessary for these charities to turn the digital asset into cash before they lost their value in next year. For example, Silicon Valley Community Foundation disclose that more than 45 percent of its investment assets would be restricted in 2018 to being converted in cash. One important fact is that is it necessary for every charity to disclose their financial data only once a year by which they cannot get enough knowledge about the risk included in their wealth.
A large number of the donor in these days gives donation in term of digital money instead of cash. This will give benefits in two ways, as it helps to understand the working of transaction and the value of these assets will grow over time. Many other companies and their top executives donate assets as they become valuable over time. There are numerous digital assets are available in the market which is used to give a donation such as bitcoin, stocks, and bonds etc.