We are always fascinated by nonprofit technology and how it can help you create more impact in your organization.
That’s why we love staying on top of the current trends! Whether it’s virtual reality for nonprofits or it’s cryptocurrency – there are plenty of nonprofit tech trends that may be awesome for your organization.
And that brings us to none other than NFT fundraising! We’re bringing you a basic guide to this latest craze. And we’re sharing how your nonprofit can leverage it!
What is an NFT?
NFT stands for non-fungible token, and it exists in the same realm as cryptocurrency. When crypto burst onto the scene, NFTs weren’t too far behind.
And while they sound like something of the future, they’re actually becoming more prevalent among younger generations!
So, what is a non-fungible token then? An NFT acts as the “deed” to a unique item. The token shows that you (or whomever!) own a digital item such as art or even real estate. Non-fungible refers to an item that is unique and can’t be replaced.
Your NFT Fundraising Glossary:
But before we get further into NFTs and how they work, you probably should know about a few key terms.
- Blockchain: This is a way to record information so people can’t cheat or hack into the cryptocurrency (and NFT) system. NFTs are built “on the blockchain.”
- Community: A group of people who own an NFT project.
- Ethereum: Popular type of cryptocurrency. This is the currency of choice for OpenSeas.
- MetaMask: Your virtual wallet for the cryptocurrency you use to purchase NFTs on the market.
- Minting: Turning a digital file into an NFT.
- NFT: Non-fungible token. A digital item or product that has value and is purchased through cryptocurrency.
- OpenSea: Facebook Marketplace for NFTs – AKA, where you buy NFTs.
- Projects: A collection of NFTs that are individual pieces but that are in the same style or form.
How Does an NFT Work?
When an NFT is created, it has its own unique ID and metadata assigned to it. That means that no other NFT in the marketplace has the same code, which cuts down on people copying and pasting or otherwise duplicating the original.
The NFT is the token that shows that you own the right to the cryptocurrency value of the digital product.
What is NFT Fundraising?
Naturally, this might all sound too futuristic for any nonprofit to take notice of it. But more and more organizations are accepting cryptocurrency donations, and NFTs aren’t far behind!
Plus, as the world continues to prioritize virtual events, NFTs are going to continue gaining popularity.
NFT fundraising is essentially creating digital art or product in one way or another. That could involve your nonprofit going through the process of doing it. Or your organization could collaborate with someone who has experience doing so already. Then, those products can be sold with funds supporting your mission.
And if you’re interested in real examples of NFTs that have benefited nonprofits, then check out this article from The Giving Block!
How Can Your Nonprofit Participate in NFT Fundraising?
So how exactly can your nonprofit leverage this innovative type of fundraising? Here are 3 ways to get started with it:
1. Host NFT Fundraising Auctions
One of the best ways your nonprofit can leverage NFT fundraising is through NFT auctions. Consider adding it as a part of a larger fundraising event. Or create an event centered around it!
Your nonprofit can partner with NFT artists to create unique items related to your mission or your organization. A great local artist can also leverage their own platform and share that proceeds are going to your cause.
2. Collaborate with Corporate Sponsors
If your nonprofit is brand new to cryptocurrency and NFTs, then it might be best to work with a “mentor.” Collaborating with corporate sponsors and organizations can help you test out if NFTs are a good fit for your nonprofit.
3. Create Your Own Nonprofit NFT Concepts
There’s a great chance that plenty of your supporters would be interested in NFTs that your nonprofit makes! Considering they love what you’re doing, creating an NFT based on your mission could prove to be a fantastic fundraising endeavor.
For example, a nonprofit aquarium may have penguins create artwork by walking on a canvas with painted feet. The canvas can then be converted into a digital product. From there, it can be turned into an NFT.
Other NFT Fundraising Ideas:
- Art created by a local artist that’s centered around your nonprofit’s mission.
- Exclusive content or footage from staff and volunteers that are working on your nonprofit’s mission.
- Digital badges or ribbons created for your organization.
- Digital photography from someone working in the field for your cause.
How to Create a Nonprofit NFT?
If you’re ready to dive into the world of cryptocurrency and nonprofit NFTs, you can get started in with these 5 steps:
- Decide the NFT concept your nonprofit would like to offer. This may also involve working with a local artist, an NFT artist, or a corporate sponsor who has experience in the market.
- Plan out a strategy for your NFT once it’s created. How are you going to let your supporters know it exists?
- Open up an account with MetaMask to act as your virtual wallet.
- “Mint” your nonprofit’s NFT on the marketplace, such as OpenSea.
- Promote your nonprofit NFT according to your strategy, such as a virtual auction!
Is the Nonprofit NFT Fundraising Trend Right for Your Organization?
The best way to know whether or not NFT fundraising is right for your nonprofit is to consider your ideal donors.
Younger generations, primarily millennials and Gen Z, are the ones who are most interested in cryptocurrency. If your ideal donor falls in that category, then it may be worth it to explore the option!
Even if your ideal donor isn’t a part of the younger generation, you never know until you collect donor data.
So, if you’re interested in creating NFTs or hosting an NFT fundraising auction, then it’s a great idea to survey your supporters. See if they’d be into the idea!
Curious about diving into the world of cryptocurrency donations? Or would you rather just dip a toe at this point?
Check out our free webinar on cryptocurrency donations from The Giving Block at Nonprofit Library!