NFTs, or non-fungible tokens, are best known for the digital artworks they store on a blockchain. But they’re not just fun to look at and collect. NFTs are also one of the most exciting catalysts for a new type of nonprofit fundraising: crypto philanthropy. For NFT creators using their platforms to support mental health-related charities, their serious intentions about bettering the lives of others contrast the sometimes-whimsical qualities of their art.
Improving Mental Health Is A Global Priority
Across the U.S. and worldwide, millions of people are affected by mental health-related issues. People living with a mental illness (or those who know somebody who does) understand the critical importance of addressing mental health through education, advocacy and access to care.
Despite the great strides made in recent years to destigmatize mental illness, public education around the issue is still lacking. Awareness campaigns like May’s Mental Health Awareness Month can help. However, donors also need to step up and offer support to mental health-related nonprofits perhaps now more than ever before.
Since the start of the Covid-19 pandemic in early 2020, anxiety and depression have reportedly increased globally by 25%, according to the World Health Organization. At the same time, the nonprofit sector has faced increased financial uncertainty. Due to economic disruptions caused by the pandemic, 75% of nonprofit organizations made budget cuts. Because of these two factors, many organizations committed to addressing mental health care have explored new ways of generating revenue to cover operating costs.
In our experience as a bridge between crypto donors and nonprofits, there are a variety of nonprofits that are now accepting cryptocurrency. Doing so has not only opened the door to engaging with a new demographic of crypto donors, but it has also allowed these organizations to work with the NFT community on charity art auctions and other crypto-enabled philanthropic methods.
Nonprofits Can’t Afford To Ignore Cryptocurrency And NFT Donations
Though cryptocurrency donations make up a small percentage of all charitable giving, the exponential growth in crypto philanthropy is enough to turn heads in the nonprofit sector. More than $300 million worth of crypto was donated to charitable causes in 2021, consisting of both small and large individual donations as well as corporate-sponsored gifts.
Crypto donations are on the rise for a number of reasons, mainly due to factors such as these:
In the case of NFT-related donors, their support often has the dual effect of increasing financial support while also raising visibility for important issues among NFT collectors. Those NFT projects with a charitable component are also, directly or indirectly, turning their collectors into cryptocurrency philanthropists.
How NFT Collectors And Creators Can Support Mental Health Causes
As NFTs have risen in popularity over the past few years, many projects have not only become popular, but highly profitable. In 2021, the market for NFTs generated about $23 billion in trade volume according to Forbes. As a result, many NFT creators use their sizable reach to educate their followers about issues they care deeply about. Many also donate large sums to nonprofit organizations on a regular basis. NFT artists can get involved in crypto philanthropy by first identifying a nonprofit that accepts crypto donations.
NFT projects can engage in fundraising for/with a nonprofit. While the specifics can vary, NFT fundraising is typically done in one of two ways:
- Through a collaborative partnership with both the creator and the nonprofit involved from start to finish
- Driven by the NFT project or creator with the proceeds or royalties donated directly to the nonprofit following the NFT sale
NFT creators and nonprofits then decide which donation method works best for them. Donation methods include:
- NFT charity projects that donate 100% of their proceeds to nonprofits
- One-off charity auctions that put NFT artworks up for sale
- Earmarking a percentage of NFT sale royalties for donations
The meteoric rise of NFTs, and the generosity of NFT creators and collectors, have not gone unnoticed by the nonprofits that are raising millions of dollars to save lives.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.