Australia Gets First Blockchain Charity
Wednesday, 4th July 2018 at 5:07 pm
Fundraising is set for a technological makeover with the launch of Australia’s first charity to be built natively on the blockchain.
New South Wales charity, Tokens for Humanity, is the only legally registered blockchain charity to be recognised by the Australian Charities and Not-for-profit Commission.
Set to launch in the coming months, it aims to revolutionise the charitable industry by making charities transparent, fundraising more efficient, and moving records and data to the public domain.
Co-founders Bryce Thomas and Frederick Brien told Pro Bono News they hoped to break down the barriers for charities to be able to adopt new technology and unlock new and uncontested markets for fundraising.
“What we’re trying to do with the technology that we’ve developed, and that we are continuing to develop, is to show charities that adopting new technology into very traditional organisations, conservative organisations, is not something that they need to fear,” Brien said.
“It’s something that we’re proving can potentially be used today and something that they can adopt.”
Thomas said charities had shown they were interested in blockchain – a method of storing data where transactions are recorded and confirmed anonymously – but the technology was complicated.
“Even for people who are technology natives it’s very, very complex but the whole idea of this is how do we help charities access new markets of funds really easily,” Thomas said.
“So we do the hard work and we give it to them in a very basic form because we want them to continue to focus on what they do best, which is pursuing their charitable purpose.
“We want to take all the headaches away and just help them fundraise. So Tokens for Humanity allows direct cryptocurrency donations to charities and TokenSpin also allows raffles. We’ve got two channels of fundraising.”
The new charity was developed out of the University of Queensland’s accelerator program.
Thomas said it started with a raffle platform which used smart-contracts on the Ethereum blockchain to make traditional charity raffles transparent and efficient.
“We started to develop this fundraising product with charities because we saw that a lot of people started to get interested in cryptocurrency and there were a lot of new entrants into the market,” he said.
“We looked at the high charitable fundraising costs, specifically for raffles, and we thought there was actually a much better way to do this. If we put it into what’s known as a smart contract then we can make the raffle really, really cheap. So instead of, on a variable split, charities paying 70 per cent in admin and marketing and so forth, they can cut that down by a significant amount.
“We thought it’s a really great application of technology and we can allow the charities to get access to this complex new product and make it easier for them to use. And then in that process we registered our own charity to run TokenSpin, to run these raffles, and we called it Tokens for Humanity.”
Tokens for Humanity is a blockchain governed charity, with everything held on chain, meaning members of the public are able to view what the organisation is doing in real time, including the flow of funds.
“So it is complete transparency,” Thomas said.
“It’s something that hasn’t been done before and we thought it was a really great idea and we could make it a reality.
“We put this proposal forward to the Australian Charities and Not-for-profit Commission and we told them that we’re going to be using these blockchain products to fundraise and also with our governance as well, and they approved it. They gave us authority to operate and use blockchain fundraising products and also for governance as well. So this is the first of its kind in Australia and possibly even globally.”
Thomas said it was “almost like an experiment”, to see what happens when the public can see everything that the organisation is doing in real time.
“We can’t submit fraudulent numbers because what is there is there, it is really interesting technology for that. It’s secure and it’s totally transparent, it’s pretty revolutionary stuff,” he said.
Thomas said another plus that appealed to charities was that they were “not fishing from the same pool”.
Rather than increasing competition within a relatively fixed pool of donor funds, blockchain provides a way to actually expand the pool.
“The demographic in that market is really quite different. So there are a lot of wealthy individuals that hold cryptocurrency and these individuals are kind of disconnected from your more traditional fundraising pools,” Thomas said.
“So that’s one of the things I think that excites them is that ability to be able to access these new demographics of people.”
In a bid to help charities understand the potential of blockchain the Australian Centre for Philanthropy and Nonprofit Studies is set to host a virtual seminar on Tuesday, with the developers behind TokenSpin and UK charity Alice sharing their insights.
See here for more information about the webinar.