Ethereum Beats Bitcoin as Most Donated Cryptocurrency in 2021
[Feb 3, 2022: Andrew Hayward]
Cryptocurrency donations surged by more than 1,500% on the platform, with Ethereum leading the charge. (CREDIT: Creative Commons)
The Giving Block, a platform that lets users donate cryptocurrency to an array of charitable organizations, announced today that it facilitated more than $69 million worth of crypto contributions in 2021—an increase of more than 1,500% over the previous year.
All told, the organization processed more than $69.6 million in cryptocurrency donations, up from $4.2 million in 2020. The average donation size was $10,455, according to the firm’s year-end report, with some 42% of funds donated arriving in November and December.
Pat Duffy, a co-founder of The Giving Block, said that he attributes the surge in donation volume to three key factors. One is the influx of money and new people into the crypto space, as well as increased tax literacy regarding cryptocurrency.
Lastly, Duffy points to the rise of the NFT market, which tallied $23 billion in trading volume last year and yielded projects seeking charitable partners for community-driven donations.
More than $12.3 million was donated by known NFT projects through The Giving Block in 2021.
For example, Yuga Labs—creators of the Bored Ape Yacht Club—donated funds to charity Orangutan Outreach. The team donated 66.45 ETH through The Giving Block in August, which was worth about $208,000 at the time of the contribution.
Ethereum on top
For the first time, Ethereum (ETH) supplanted Bitcoin (BTC) to top the list.
Ethereum donations via The Giving Block totaled nearly $30.8 million in 2021, with Bitcoin at almost $25.9 million.
The USDC stablecoin, which was just added to the platform in November, quickly grabbed the third spot with over $4.7 million worth of donations.
The Giving Block attributes its popularity to enabling USDC holders to skip a taxable event by not needing to convert the stablecoin into ETH to donate it.
Fellow stablecoin Dai (DAI) landed in fourth place on the list with $2.2 million, with Flow (FLOW) at $1.4 million and Solana (SOL) next up with $1.2 million. All other cryptocurrencies—such as Cardano (ADA) and Litecoin (LTC)—landed under the million-dollar mark.
The Giving Block said that meme token Shiba Inu (SHIB) became the platform’s fourth-most-donated crypto by mid-December after being added in November.
Ultimately, The Giving Block processed about $125,000 worth of SHIB, along with nearly $225,000 worth of rival meme coin, Dogecoin (DOGE).
The Giving Block’s platform grew significantly in 2021 as it expanded from supporting about 120 charitable organizations to more than 1,200 by year’s end. That includes institutional-level clients, with 77 nonprofits now onboard with $100 million in respective gross receipts.
Duffy said that he was surprised to see more than 100 “high-power” people and companies in the crypto space—from crypto exchange FTX to skateboarding legend Tony Hawk and Galaxy Digital CEO Mike Novogratz—commit to The Crypto Giving Pledge, in which each agrees to donate 1% or more of their respective crypto holdings to charity each year.
“That’s no small ask,” Duffy told reporters. “One percent gets to be a lot when you’re talking about billions of dollars in crypto.”
We’re only a month into 2022, of course, but the crypto markets struggled mightily in January. In a prolonged bear market, should we expect reduced crypto donations? Not necessarily.
Duffy said that overall market growth and increased tax literacy have steadily helped drive up contributions, as The Giving Block’s annual totals steadily increase each year.
Besides, once the bear market eventually gives way to a bull market, crypto holders will be “dramatically incentivized to donate” after the price bounces back, he explained.
“The larger the difference between the price you bought it at and the price you donate it at, the greater the tax incentivization,” Duffy said. “So the millions of people buying crypto when it’s down? Those are your future donors.”
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Note: Materials provided above by Andrew Hayward. Content may be edited for style and length.
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