In the previous post we described the advantages of the fundraising in crypto in comparison to the traditional fiat fundraising. It’s obvious, however, that such a platform not only has advantages but also faces challenges that shall be addressed properly.
The main challenge is definitely the uncertainty that a major part of the world’s population feels toward cryptocurrencies despite the active development of the cryptoprojects and the bulls’ market in the last half a year. Some think that the involvement in the cryptoworld requires knowledge of further math and cryptography. Others are afraid that cryptocurrencies are illegal and are used by criminals. The thirds don’t even know about crypto, perhaps they’ve heard the word “bitcoin” but nothing more.
So for this platform to be used widely there should be the possibility on the platform to “hide” the crypto functionality from the donors who don’t want to be involved in the cryptoworld. So the platform should have the functionality to make a donation from a credit card or other fiat payment systems which will be converted to cryptocurrencies afterwards.
Transaction fees and speed
The second challenge is the incredibly high fees of transactions in the Bitcoin and Ethereum networks. The average donation on GoFundMe is around $15. While the gas fee for one transaction in the Ethereum network often reaches $50–60 and very rarely drops lower than $15–20 in the last months. It’s hard to imagine a big crowd of donors who are ready to pay 100–400% transaction fee for every donation.
That’s why it’s important to choose the network with the lowest transaction fees and the fastest transactions computing.
The third challenge is the off scale volatility of most cryptocurrencies’ exchange rates which make any long-term calculating impossible. Let’s imagine you are raising $30K for your project. So you start a fundraising campaign for 0,5 BTC. The time goes and at the moment you’ve raised the target amount of 0,5 BTC it costs only $5K or even $3K, as it was not a long time ago. As a result you feel like a fool: you raised the target amount of funds for your project but you have no chance to implement it.
To avoid such situations all fundraisers on Help each other platform will receive the donations in the stablecoins which always cost around $1. Thanks to that the NGOs raising money for long-term projects don’t have to exchange the received funds to fiat immediately. They can keep the funds in stablecoins and make exchanges only when they need fiat funds.
The fourth challenge is the unavailability of the recurring payments on most of the current fundraising platforms. So the donor cannot subscribe for a monthly donation to an NGO he or she likes to support.
That problem can’t be solved in many networks, but we found a way to implement such a functionality, so the recurring payments will be available on Help each other.
Looking for your propositions
So our fundraising platform can have all the advantages while lacking the flaws that the fiat fundraising platforms have.
However we always want to be as perfect as possible. Did we miss something? Are there some nuances that should be implemented on the platform for it to become even more convenient? If you have propositions email us. The authors of the best propositions will receive 100 HEO tokens each (~100$).