Should You Accept Cryptocurrency Donations?

By the end of 2020, more than 20 million Americans owned cryptocurrency (digital currency such as Bitcoin, Litecoin, or Ethereum), and by the end of 2021 another 50 million are predicted to buy some form of cryptocurrency, according to national research. In addition, a growing number of the largest donor advised funds (DAFs) and ECFA members accept cryptocurrency donations.

This rapid growth raises the question: should your church or ministry start accepting cryptocurrency donations? We offer three ideas:

1. ECFA’s recent research on best practices in nonprofit fundraising asked whether Christ-centered ministries and churches are set up to receive cryptocurrency donations (free download here, see page 11). Among the 710 survey participants, 5% are ready to receive such donations. However, within that group of those already set up to receive cryptocurrency donations, 74% have received one or more such gifts. We interpret this to mean that in many cases, people wanted to make a gift from their digital wallets, and the church or ministry responded by setting up the process.

2. ECFA’s Knowledge Center lists articles on implications of cryptocurrency donations in terms of the IRS and accounting. See, for example, our link to BMWL's article “Granny Is Investing in Bitcoin—It Pays to Be Ready When She Wants to Donate Some to Your Organization.” See also Capin-Crouse’s “Cryptocurrency Considerations for Nonprofits.”

3. Finally save the date for an upcoming ECFA webinar with added expert perspectives on cryptocurrency donations. The hour-long free event is scheduled for Wednesday, September 15th at 1 PM EST and will also be available for free replay after it airs. Registration will open soon here.

 


This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.

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