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Sitting in front of his computer last week, Mische demonstrated how the transactions appear on his end.
“Did you see that?” he asked suddenly, pointing to his computer screen. “The exchange rate just changed.”
Anonymous and volatile
Those fluctuating rates are one of the greatest risks — and rewards — involved in using digital currency.
“If you have 10 bitcoins donated one day, it could be worth half that the next — or 20 times more,” said Nick Holland, senior payments analyst at Javelin Strategy & Research, a California-based firm that analyzes consumer payments behavior.
The upside for charities, however, is there are no transaction fees, so the entire donation goes to the cause, he said.
The currency is of “extremely limited use” right now, said Holland, “unless you count taking funds out and putting them in. But it is finding its way,” he said.
There’s always a bad guy
That anonymity can attract the less-than-scrupulous. For example, Bitcoin 100, a national nonprofit devoted to encouraging charities to accept digital currency, received several donations from someone who later acknowledged he had “stolen” the currency. Charities will need to decide whether they want to risk taking tainted money.
Regardless, there can be a significant amount of cash in the hands — or cellphones — of digital currency holders, in particular those who invested early and saw their fortunes rise.
Optimistic about the financial implications for nonprofits, Mische is hosting an April 16 Twin Cities Meet-Up on digital currency and its role in the nonprofit sector.
Meanwhile, folks like Goebel hope the number of charities accepting digital currencies rises. It could be both a financial lift for charities and a boost to the legitimacy of the currency.
“It’s exciting to see a real-world charity joining the crypto community,” he said.
Jean Hopfensperger • 612 673-4511