Why it can be 'hugely beneficial,' expert says, investors' crypto donations to charity skyrocket.

• As digital currency investors look to maximize their tax benefits and make a positive impact, there is a growing interest in donating cryptocurrency to charity.
• In 2024, Fidelity Charitable has received $688 million in crypto donations by Nov. 19, compared to $49 million in all of 2023.
• Experts suggest donating profitable assets such as crypto or stock, rather than cash, when making charitable contributions.

As digital currency investors look to maximize their tax benefits and make a positive impact, there is a growing interest in donating cryptocurrency to charity.

Crypto giving has been recognized as highly advantageous by many people, according to Kyle Casserino, vice president and charitable planning consultant for Fidelity Charitable, which accepts Bitcoin, Ethereum, and other cryptocurrencies.

Amid the latest rally, Bitcoin donations have increased due to investors becoming aware of the tax benefits, as stated by Casserino.

According to Fidelity Charitable's 2024 giving report, the organization has received $688 million in crypto donations from January 1, 2024 to November 19, which is a significant increase from the $49 million received in all of 2023 and the $38 million received in 2022.

Since 2015, Fidelity Charitable has received over $565 million in total gifts.

Casserino stated that the majority of our volume, in terms of both quantity and revenue, is derived from bitcoin.

DAFgiving360, previously Schwab Charitable, does not disclose information about crypto donations. However, the organization reported that 63% of its contributions came from non-cash assets, including crypto and stocks, during fiscal year 2024.

As of Jan. 2024, 56% of the top 100 U.S. charities had accepted crypto donations, according to The Giving Block, a platform for digital currency gifts and fundraising.

Donating profitable crypto is a 'good strategy'

The majority of taxpayers opt for the standard deduction on their tax returns, which means they forfeit the opportunity to claim specific tax deductions, including charitable donations.

It's generally better to donate profitable assets, like cryptocurrency or stocks, rather than cash when claiming charitable deductions, according to Andrew Gordon, a tax attorney, certified public accountant and president of Gordon Law Group.

Giving appreciated investments as gifts can help donors and charities save money by avoiding capital gains taxes. If the asset has been held for more than one year, the donor can deduct its fair market value. The tax break for public charities is capped at 30% of the donor's adjusted gross income.

Gordon advised that it is a wise strategy to invest in crypto and bitcoin, especially with their current all-time highs. He stated that they would be recommending this more to people in the future. According to Coin Metrics, the price of bitcoin was around $95,000 early on Dec. 4, up by nearly 120% year-to-date. Bitcoin investors experienced a post-election rally fueled by President-elect Donald Trump's promise of pro-crypto policy during his campaign.