Nonprofits & NFTs Explained: A New Vision for Charitable Fundraising

For our part, The Giving Block has acted as the glue that binds together these two worlds: the philanthropy-minded NFT projects and the growing number of charities that accept donations in ETH and other cryptos. Below, we’ve gathered some new ideas for nonprofits looking to fundraise with NFTs (ICYMI, we already covered the basics of how NFTs and charities overlap). We’ll also share examples of several awesome NFT projects working to make a positive impact on the world, while bringing greater visibility to the organizations enacting that change. 

The massive growth of NFTs, explained

In simple terms, NFTs have gotten really big, really fast. Seemingly overnight, they went from cult collectors items to being auctioned at Christie’s to being used to support nonprofits that share the United Nations’ Sustainable Development Goals. How did we get here? Let’s rewind. 

Before NFTs (as they came to be known), several crypto digital collectibles like “colored coins” paved the way for the creation and interest in unique, blockchain-based digital assets. In 2014, the first-ever NFT minted was a work called “Quantum,” by artist Kevin McCoy, which sold for $1.4M a few years later: 

An early wave of NFT projects like CryptoPunks and CryptoKitties broke through into mainstream media, while the specific NFT marketplaces like OpenSea were created to support the emerging industry.  Fast forward to today: the non-fungible token has taken the art world, and the rest of the world, by storm. (Pause here if you want to go in-depth on NFT history.) Millennials and Gen Xers were the first to create a buzz around NFTs, attracted in part by the novelty of owning and displaying these unique digital artworks. Institutional investors quickly followed, spending millions in digital auctions, along with a wave of celebrities, athletes, brands, and influencers eager to capitalize on the hype. In a short amount of time, NFT creators like CryptoPunks witnessed an explosion in market demand and global intrigue for their art.

“Some NFT enthusiasts see them as collectibles with intrinsic value because of their cultural significance, while others treat them as an investment, speculating on rising prices,” said a Reuters report from earlier this year, which noted that the market surged to $2.5B in sales through Q2 of 2021. According to Google search data, interest in NFTs began to blast off in February 2021.

The trend in the graph above suggests that the NFT has begun to mint itself a permanent place in the public consciousness. 

Art with a social impact

NFT artists haven’t been shy about their support for charitable causes or key social issues. An increasing number of NFT projects have taken the initiative to donate a portion of their profits from sales to charities. 

The selling price of some NFTs reaches into the millions, so we’re not talking about small change. NFTs are becoming a major force in charitable fundraising. Several projects are donating hundreds of thousands, even millions, of dollars to nonprofit organizations. These generous creators are fostering impactful relationships with charities, both by endowing them with charitable support and by sharing their passion with a devoted fanbase.

The most charitable NFT projects (as of November 5, 2021):

If you run an NFT project and want to support a charity, get in touch with us for assistance.

How NFTs can support charities

For many mission-driven organizations, a single major gift from an NFT project can be a game-changer. Small nonprofits, especially, can even double their annual operating budget with one six-figure donation. 

Here are four of the ways that NFTs can help support nonprofits:

1. Corporate giving partnerships

Because of their vast resources, big brands are often quick to jump on new trends and ideas. By working with a well-known corporate partner to host an auction for charity, NFT artists can use their creative powers to raise large sums of money for good causes.

Recently, Coca-Cola partnered with the 3D artists at Tafi to auction off special-edition NFT “loot boxes,” resulting in $575,883.61 donated to the Special Olympics.

2. Celebrity-driven NFT auctions

Another way to bring in visibility and bidders is to link your NFT fundraising effort to a famous person. In August 2021, NFT platform Cryptograph and photographer Davis Factor teamed up to auction off eight never-before-seen photographs of the late NBA star Kobe Bryant. All of the proceeds will go to benefit the Mamba and Mambacita Foundation.

Factor and Tommy Alastra, co-founder of Cryptograph, sat down to speak with news outlet Cheddar about the fundraising project: 

3. The NFT as a charitable investment

Instead of donating a cash (or crypto) gift, a generous collector can choose to purchase and donate an NFT to charity. A recent article from Yahoo noted that “this would be similar to how people donate valuable items for charity auctions or other events to raise money.” If you’re taking this approach, it might be wise to first ask if the charity is comfortable holding onto the NFT as an investment, or if they would prefer to sell it and convert the proceeds to cash. 

4. Direct donations to charities

In many cases, NFT artists simply want to identify an impactful charity and coordinate with them directly, without any celebrity endorsements or corporate backing. We’ve seen many amazing relationships between NFTs and charities develop as a result. 

Bored Ape Yacht Club x Orangutan Outreach

One of the biggest names in NFT culture is Bored Ape Yacht Club (BAYC), a collective that creates ape-themed works that are popular with crypto enthusiasts as well as athletes like Steph Curry and Odell Beckham, Jr. From part of their NFT sale proceeds, BAYC has made several ETH donations to Orangutan Outreach, a nonprofit that protects orangutans in their native forests of Borneo and Sumatra and provides care for orphaned and displaced orangutans. 

BAYC’s donations have allowed Orangutan Outreach’s founder Richard Zimmerman and his team to build sanctuaries for orangutans as soon as they receive governmental approval to do so. Otherwise, he said, they would have to wait and run a capital campaign. The gifts, totaling an incredible $850,000 to date, weren’t merely appreciated by Orangutan Outreach; they became the catalyst for a whole new fundraising strategy. 

My thinking was: If I’m going to get my organization into crypto, I have to put my own money where my mouth is and actually learn about crypto. So I set up a wallet for myself to get started. The next step was to invest in crypto personally in order to learn more about the process, the technology and the culture. A bit later, after Orangutan Outreach received a generous donation from an NFT artist, I did the same thing with the NFT space. I felt I had a responsibility to learn more about NFTs. — Richard Zimmerman, Founder, Orangutan Outreach

Like many other nonprofit leaders today, Zimmerman has discovered that the crypto and NFT communities are serious about making a positive impact on the world by supporting charities. To get more immersed in the culture, Zimmerman purchased a Bored Ape NFT, which he uses as his organization’s Twitter avatar. He also regularly engages in conversations with BAYC fans on their Discord channel, and notes that he has gained new supporters as a result of BAYC’s highly-visible form of philanthropy.

With such a new trend still catching on in the mainstream, it’s easy to imagine a future for NFTs with greater popularity, higher sales volume, and more fundraising opportunities. As we enter a new digital era powered by the blockchain, it’s clear that NFTs are helping to redefine the “art” of fundraising.