Since the earthquake that devastated parts of Turkey and Syria in February, blockchain analytics firm Chainalysis estimates that around $5.9 million in crypto donations have been made to support relief efforts in the region.
The Turkish Ministry of Interior’s Earthquake Humanitarian Aid Campaign, the Turkish Red Crescent, Save the Children and Project Hope have all received cryptocurrency-based donations. In addition, several cryptocurrency exchanges, including Binance, Bitfinex, OKX and KuCoin, donated more than $9 million to support victims in the region.
Cointelegraph reached out to Chainalysis to uncover the methodology used to monitor crypto-based donations supporting disaster relief efforts in Turkey and Syria.
Chainalysis research director Kim Grauer said the company uses a combination of human intelligence, gathered by experts, and proprietary heuristics to identify and monitor flows to cryptocurrency services. This includes organizations that accept donations and scams that seek to divert donations from unwitting supporters.
Grauer believes that the speed of transactions and the global nature of cryptocurrency transactions are an important means of providing quick monetary support during a crisis:
“Cryptocurrency is cross-border, fast, and liquid, making it the ideal technology to raise funds and get them to where they are needed quickly.”
Grauer also highlighted the ability to accurately monitor blockchain data as another strong argument for the utility of cryptocurrencies to facilitate donations and support after major disasters and emergencies:
“The transparency of the blockchain is a unique benefit for cryptocurrency, providing opportunities to help organizations track donations and for law enforcement agencies to identify and track illegal schemes trying to capitalize on crises.”
Antonia Roupell, head of Web3 operations at Save the Children, told Cointelegraph that the organization first accepted Bitcoin (BTC) as a donation method in response to Typhoon Haiyan, which devastated the Philippines in 2013. As of 2020, the charity has raised $7.4 million in donations cryptocurrency.
Related: Ukraine has received $70M in crypto donations since the beginning of the Russian conflict
This continues during the earthquake relief organization in Turkey and Syria. Roupell highlighted the many benefits of crypto-based donations compared to fiat-based donations.
“Most of our crypto donors are first-time donors to Save the Children so crypto allows us to access a new and growing supporter base.”
Blockchain functionality also provides recurring power, according to Roupell. In 2021, Save the Children received some Ethereum donations from nonfungible token (NFT) sales, some of which coded future donations through certain NFT smart contract functions.
Roupell also highlighted the tax benefits in the United States for donating cryptocurrency to charity, which has led to an increase in donations at the end of the financial year. He also noted that crypto donations, on average, are higher than fiat ones.
While highlighting the positives, Roupell said that a drawback is the anonymity of cryptocurrency donors, who cannot thank benefactors for their donations.
Roupell believes there is great value in blockchain-based solutions to facilitate and support aid efforts around the world, and that humanitarian organizations will play an increasingly important role in integrating and expanding access at the grassroots level:
“Cryptocurrency is a great donation vehicle, but the underlying technology, peer-to-peer electronic cash, is truly revolutionary for economic inclusion.”
The charity supports various cryptocurrencies accepted by the crypto donation platform, The Giving Block. Roupell said the organization “does not endorse, promote or give consideration” to any particular token. It also accepts global fiat currencies and shares, with a priority to raise urgent funds to support the global humanitarian response.