The Archdiocese of Washington says it is happy to accept cryptocurrency donations, even if parishioners cannot physically put Bitcoin on a collection plate. It is believed to be the first Catholic diocese in America to announce this capability.
The archdiocese, which has 655,000 members in the District of Columbia and five counties in Maryland, said Tuesday it will use a donation service company to process donations to various Catholic ministries, including the Parish Support Initiative, which helps fund food pantries and hot meal programs.
The Archdiocese has not reported any cryptocurrency donations so far and noted that the option started on July 29. He said all donations will be immediately converted into cash and sent to the church.
Joseph Gillmer, the archdiocese’s executive director of development, said via email that while cryptocurrency donations are in a similar category to stock or bond donations, the potential for high donations is greater.
“The number of gifts received may be low compared to traditional ways of giving, but the average amount of each gift is likely to be several times higher,” he said.
“I view crypto donations as another way for donors to support charitable causes,” Gillmer said. “It’s part of a philosophy to make it easier for donors to achieve their philanthropic goals by being as flexible as possible.”
Since hitting a peak of $3 trillion in market value in November, cryptocurrencies have fallen, according to the Wall Street Journal and other news outlets. The Journal noted that the total market value fell to around $890 billion in the second quarter of this year.
According to cryptocurrency exchange Gemini Trading Group, which tracks industry-wide data, 20% of Americans said they held cryptocurrency last year, creating a large pool of donors. potentials.
“Even though Bitcoin is down more than 50% from its peak, if you have people who invested in Bitcoin four years ago, they are still 10 times higher than they were when they bought it,” said cryptocurrency expert David Sacco, a practitioner-in-residence at the University of New Haven’s Pompea College of Business.
An investment of $2,200 in 2018 now amounts to $22,000. Mr. Sacco said the appreciation could lead to a big capital gains bite if that bitcoin is converted into cash. Donate it to charity, Sacco said, and you get the $22,000 tax deduction even if you only spent a small fraction of it in cash to acquire the asset.
Yet he does not foresee a rush in cryptocurrency donations to charities.
“I think donating with cryptocurrency will be about as popular as people using cryptocurrency to buy things,” Sacco said. “It’s out there, people use it to generate publicity, but I don’t think there’s a place, whether it’s people buying textbooks with crypto or people giving money. ‘silver, [except] to create buzz.
Yet 18 months into what the Salvation Army’s Western US Region calls its online CryptoKettle, the evangelical organization has raised $121,502 in cryptocurrency donations, said a manager.
“It’s a new way to give,” said Lt. Col. Kyle Smith, communications secretary for The Salvation Army in Rancho Palos Verdes, Calif.
He said these donations are occasional, similar to periodic donations of gold coins from collection kettles in shopping malls during the winter holiday season.
Cryptocurrencies, such as Bitcoin and Ethereum, are encrypted streams of data that are monitored by members of a secure computer network called blockchain, which acts as a ledger for transactions.
The Archdiocese of Washington and the Salvation Army chose Engiven, a San Diego-based cryptocurrency donation service company, to process the donations.
CEO and co-founder James Lawrence said the company has different programs for organizations. Commission fees range from 3% to 4% per transaction and lower for those with an annual subscription or a “tailor-made” plan, he said.
Lawrence said the fees were analogous to the credit card processing fees that nonprofits pay when accepting donations.
“Service charges are only part of the nature of how money is moved,” Lawrence said. “If someone donates $1,000 to one of our clients and Engiven receives 3%, or $30, we consider that to be very good value. The level of complexity involved in trading and maintaining compliance and security, it’s a pretty fair deal for the service that’s being offered.
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