NFTs are difficult to explain to many donors

For those who can’t quite wrap their arms around the future economy, non-fungible tokens (NFT), Bitcoin and Ethereum are mysteries. But there is nothing mysterious about a market cap of Bitcoin exceeding $468.69 billion yesterday (down from $883.44 billion the same day last year) and Ethereum at $231.27 billion (down 38% from the same day in last year).

Dogecoin, made popular by Tesla founder Elon Musk, who teased the concept by not being able to explain it on his TV show Saturday Night Live, doesn’t even crack the top 10 of digital currencies. It is at number 11 with a market value of 9 billion dollars, according to bankrate.com.

Paying for NFTs, a limited number of unique digital images created by artists and celebrities, with digital currencies often evokes another three-letter acronym starting with the letter N.

Even with the current difficulties in explaining these new, Blockchain-linked commodities, markets still determine the value of a digital currency in a way that is not much different than determining the value of $1 in foreign exchange markets or an ounce of gold: through a socially agreed value – what someone is willing to pay.

The volatility of an item means it can be replaced by an identical item—it’s not original, explained Michael Johnston, founder and president of HJC New Media in Toronto. “For example, you can trade a dollar for four quarters and you will have the exact same amount. Non-fungible simply means, more or less, that something is unique and cannot be replaced by another similar thing,” he said. NFT is exactly that, but in this case it is built on the Ethereum Blockchain.

What is not a mystery is the more than $200,000 that an NFT event raised for CARE USA. And organization leaders initially did not know about the event. The digital artist Jack Butcher was troubled by the distress in Afghanistan. He created a small piece of digital art and sold it for the digital currency Ethereum.

On August 17, 2021, NFT’s first offering date, one Ethereum was worth approximately $3,006 when converted to US dollars. The NFTs were sold for 0.03 Ether or 10 at a time for 0.28 ETH. The sale proceeds amounted to 59.54 ETH (about $208,879), according to data from CARE USA.

“Jack Butcher decided to put together with the NFT proceeds for the CARE contingency, the Care Package for Afghanistan,” explained Alejandra Villalobos, assistant vice president, major gifts, for CARE USA. “CARE started accepting crypto in 2020, maybe a little late in the game, but very enthusiastically,” she said.

To get into the NFT game, an organization needs a digital wallet or a processor, which in the case of CARE USA is The Giving Block. “The biggest thing is that nonprofit (leaders) tend to think it’s more complicated than it is,” said Alex Wilson, co-founder of digital currency processor The Giving Block. All of the crypto is converted into US dollars, he explained. The Giving Block also works with Save the Children, No Kid Hungry, Team Rubicon and Wake Forest University.

Wilson explained that NFT creators benefit in a way that artists previously have not. Historically, artists have only profited from the original sale of their creation. NFTs on the other hand allow artists to attach royalties to their creations and earn money every time their creation is sold.

Socially conscious artists see the value of their creations as a way to support a cause. Forums that partner with The Giving Block, such as DoinGud, give them the opportunity to contribute to a mission where a minimum of 5% of each sale goes to a social impact organization of their choice.

CARE USA does not hold cryptocurrencies, and immediately converts Ethereum or any digital currency donated into U.S. dollars, Villalobos said. Some non-profit organizations hold digital currencies as an investment, hoping that their value will increase.

Sankar Krishnan, executive vice president of Capgemini, urges nonprofit financial managers not to exceed between 2% and 5% of assets. You should accept digital currencies, but convert them to a currency regulated by a monetary authority, such as the US Federal Reserve. For example, one Bitcoin was trading at $48,515 at the time of writing in mid-December, down from a high of $68,990 and a 52-week low of $21,263.

Not many nonprofits are yet in the NFT space, but it is growing. CARE USA is high on the nonprofit NFT leaderboard with $208,879. “The Blazed Cat” project for Mental Health America raised $302,865 and an additional $70,648 was raised for the organization through the Blank Face NFT. Woodies NFT raised $225,960 for Tree For the Future. Women and Weapons NFT raised $104,019 for the Malala Fund. More data can be found here…

And it’s a long way away sale of one Cryptokitty for $69 million or Twitter founder Jack Dorsey selling the first ever tweet for the equivalent of $2.9 million.

Well-known brands are often quick to jump on new trends and ideas, according to Wilson. By collaborating with a well-known corporate partner to host a charity auction, NFT artists can raise large sums for causes. Wilson gave as an example that Coca-Cola partnered with 3D artists at Tafi to auction off special edition NFT “loot boxes,” which resulted in $575,883.61 being donated to the Special Olympics (

Leveraging NFTs as auction and donation pieces presents two potential opportunities, according to Johnston. The first is that you can take advantage of large donations or auctions of specifically curated pieces made by well-known artists. The second is to develop a steady stream donation with smaller, curated pieces that focus on emerging artists. “Both options provide revenue to the organization through the sale of legitimately owned media features,” he explained.

While $208,879 is a rounding error for CARE USA, which reported just under $609 million in revenue on its recent federal Form 990, the dollars add up. A majority of the NFT participants were new donors to CARE USA, according to Villalobos. The artist, who is also the founder of Visualize Value (visualizevalue.com), reached out to his community of followers, and they responded, creating a new opportunity for CARE USA.