The new philanthropic frontier: How Web3 could democratize donations
A merge between crypto and philanthropy is already underway as decentralized autonomous organizations (DAO) and nonfungible token artists alike fundraise and donate crypto to nonprofits. But what does the age-old institution of philanthropy have to learn from emerging technologies in the crypto space? Additionally, what does crypto have to offer philanthropy that could improve the sector generally?
Crypto offers the potential for nonprofits to be governed in a decentralized fashion, creating conditions that maximize the influence of communities most impacted by these organizations.
Despite its meme-based reputation at times, the crypto industry is actually in the midst of a major push toward true democracy. This effort begins by leveraging blockchain technology that has created the conditions required for decentralization.
Blockchains can host smart contracts, a sort of unadjustable code that automatically enforces rules, removing the need for central figures of authority. Rather than an individual or group bearing responsibility for operations, smart contracts can be interacted with through token voting. When blockchains are built with tokens and smart contracts, they empower online communities to build systems of token-powered self-governance called decentralized autonomous organizations.
What if a nonprofit structured itself as a DAO in order to leverage the aforementioned benefits to further its mission? To successfully create a Community Foundation built on a DAO would transform fundraising, grant distribution and even nonprofit management into a transparent democratic process. This is the thesis that led us to create Endaoment as an organization that is completely on-chain and embraces the benefits of decentralized
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