Blockchain refers to a public book technology that is digitally signed to verify the authenticity of each cryptocurrency transaction and to ensure that the information contained therein is not altered. Thus, the operations recorded in the blockchain and the ledger are considered to have the highest level of integrity.
In the early days of cryptocurrency, people thought that blockchain belonged to bitcoin. Today, it is rapidly becoming clear that technology is more than just bitcoin or digital currencies. But while blockchain has the potential to revolutionize almost every industry, nowhere will its impact be greater than philanthropy.
For charities, the blockchain provides a unique window for transparency and honesty, which can help make them more credible in the eyes of their supporters. Some of the problems faced by non-profit organizations are related to how money is spent and the lack of transparency. Donors are sometimes reluctant to donate because they are unsure of where their money is going or who they are helping. Over time, such anxieties can cause them to become frustrated.
This makes it difficult for charities to attract or retain sponsors. However, blockchain is rapidly increasing trust in the system by showing philanthropists where their money is going. Technology achieves this by making the system completely transparent and informed and easily accessible. How Blockchain Increases Transparency and Trust in Charities:
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Funds go directly to the reason donors contribute. Thanks to blockchain technology, donations should no longer go through intermediaries. Instead, they turn directly to buyers and companies that are able to help them. This helps ensure that there is less room in the system for fraud or financial leaks and that the money does not go into the wrong pockets. As a result, donors are more motivated to donate.
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All transactions can be tracked. Distributed books can be used to track transactions. Such improved tracking makes it easier to keep track of how funds are being spent. As a result, donors can even see from afar how their funds have helped people they claim to be helping by charitable foundations.
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Blockchain makes it easy to distinguish well-intentioned organizations from fraudsters. Because donations made using cryptocurrencies can be tracked, it is easier for donors to identify organizations that pursue their goals than organizations that seek to enrich only a few individuals. Thus, they get acquainted with the right charities to work with.
Overall, blockchain and cryptocurrency will help ensure efficiency and reassure supporters that their donations are focused on the work they support.
Well-meaning organizations need to adopt technology if they plan to improve transparency, as well as quickly track and transfer funds. For all these reasons, platforms like Sponsy are trying to help businesses achieve greater transparency and credibility through blockchain technology.