The Year of Bitcoin continued apace with Fidelity Investments Charitable collecting a whopping 22,000,000 USD in the world’s most popular cryptocurrency. Bitcoiners are known for their generosity, and Fidelity has developed quite a relationship with the ecosystem especially over 2017.
Also read: Bundesbank Board Member: No Plans to Issue State-Backed Cryptocurrency
Fidelity Investments Charitable Breaks Last Year’s Donor Record
“People are getting smarter about donating appreciated assets, and bitcoin is the epitome of appreciated assets this year,” Matt Nash of Fidelity Charitable told CNBC. He’s referring to a remarkable run in donations from its clients this year with regard to the digital asset.
Last year, Fidelity collected a mere 6 million USD in bitcoin. The first 11,000,000 USD of 2017 were donated throughout the bulk of 2017, over roughly eleven months. As the year wound down, the fund saw a doubling of that amount in just December.
The fund doesn’t actually hold bitcoin. Instead it funnels donations through the onboarding of popular crypto exchange Coinbase. Immediately, the decentralized currency is cashed into fiat and placed into specified account for distribution.
Fidelity is best known as a full service broker, offering financial advice, baskets of mutual funds, and even life insurance. It’s a privately held global company with 45 thousand employees and revenues approaching 16 billion.
Fidelity Investments Embraces Bitcoin
In 2017, the company really engaged in bitcoin-related businesses. While now that looks like a pretty great idea, even earlier this year bitcoin was thought too fringe for mainstream service providers such as Fidelity. By Summer, however, it added bitcoin to its platform. Slightly before that, it integrated with Coinbase and began mining.
The uptick in donations this December no doubt had to do with bitcoiners seeing what amounted to capital gains, which trigger certain tax issues in various countries. Many government revenue collectors also ask donations be made through windows of time in order to qualify for tax advantages.
Mr. Nash reminded, “This is giving season, after all, starting in late November and running through Dec. 31.” And the advantage of giving bitcoin to a fund is that clients are able to collect receipts immediately while having the luxury of taking their time with ultimate distribution. The other is volatility, as it is very likely Fidelity cashed out at the top of the market through its regular protocols, say recently, thus avoiding a nasty 30 percent haircut for a charity.
A final advantage in using an intermediary like Fidelity is the fact many charities are still wary of accepting bitcoin. Donors can be generous with bitcoin and not spook their favorite cause at the same time by donating through an established fund.
Mr. Nash sums up the predicament nicely, “They’re going to give anyway. When they give, however, their view is that they should give the best asset that they can.”
What are your favorite charities to donate bitcoin to? Tell us in the comments below!
Images courtesy of Pixabay, Shutterstock and Fidelity.
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