Just as the popularity in digital wallets and QR codes rocketed out of seemingly nowhere, we thought it fitting to share some trends that are moving in the world of the internet that could affect the way your supporters donate in the future!
We hope you’ve had a chance to see the recent webinar on Innovations in Payment Technology (if not, click here!), where Vicky Reeves, Director of goDonate, gave a quick-fire top ten tips in payment and digital technology for the charity sector.
In the webinar, Vicky touched on the evolution of the internet, Web3, and how cryptocurrencies, NFTs (Non-Fungible Tokens) and the ‘Metaverse’ could impact online fundraising in the future. Here we delve a little bit more into what these all are and what they mean to you as a charity.
So what is Web3 (or Web 3.0)?
Very simply put – it’s the latest version of the internet. Just as we have the next ‘version’ and ‘upgrades’ in consumer goods (phones, cars etc.) so does the internet have its own next version, upgrade or, evolution as it were. And we’re swiftly moving into version 3.0!
What were versions 1 and 2?
A very brief history lesson!
Web 1.0 was the onset of the world wide web, from around 1991 through to 2004 (note the dates are a little vague as there are no definitive cross-over / ‘switch on’ dates). Considered the ‘read-only web’ we were very limited in what we could do on the internet at this time, and the web was essentially a soft-copy dictionary, where pages would take an age to load via a dial-up modem. Remember Ask Jeeves?!
Web 2.0 came along, focusing more on participation and contribution. As a more enhanced version of Web 1.0, it incorporated web browser technologies and became known as the ‘participative social web’ due to introductions of interaction like; social media, blogging, commenting, tagging, podcasting etc.
Web 3.0 is a major advancement on Web 2.0, moving away from centralised platforms like Facebook, Google and Twitter and is built on a foundation of the idea of decentralisation, openness and improved user utilisation – where all of the content the user consumes is more personalised than ever before. Web 3.0 lets users interact, exchange information, and securely conduct financial transactions without a centralised authority and as a result, each user becomes a content owner instead of just a content user. Web 3.0 is essentially the “read, write, interact Web.”
And the Metaverse, what’s that?
The Metaverse, a component of Web 3.0, is the term used to describe a combination of the virtual reality and mixed reality worlds where we interact with each other using avatars. This is based on new technologies, tools and philosophies working together to further develop the way we use the web.
Focusing on social connection, in the Metaverse, you can play games, buy land, attend music concerts or create something yourself which you could potentially sell as a non-fungible token (NFT)… we’ll get onto those a little further down!
Notable examples of the Metaverse include:
- Nikeland, ‘a place to hang out, play, and dress your avatar in virtual Nike products’, opened in Roblox last year. By early 2022, nearly 7 million people had visited Nikeland!
- Ariana Grande’s virtual gig – held in Fortnite’s metaverse environment. Mainstream designers such as Gucci, Ralph Lauren and Burberry have also held their own virtual events.
There’s a suggestion that mass-uptake and adoption will be seen over the next few years. This may all sound like some fantasy Sci-Fi movie straight from James Cameron, but if the next generation are going to be spending most of their time in the ‘Metaverse’, don’t you think your organisation might want to think about being there too?
How does this affect my charity organisation?
The target market of 15-30 year olds are now less likely to be ‘on the internet or social media’, rather, they’re ‘in the metaverse’. The younger part of that age range might not be so significant now, but it’s worth taking note, as the next generation of donors, where will they be spending most of their time?
But what can a charity do in the Metaverse?
Gaming and its gamers are probably the earliest adopters, immersing themselves into the metaverse. There are more than 46 million gamers in the UK and more than 3 billion in the world. This is an enormous audience to tap into!
One of the simplest activities a charity can do, will be to advertise via some of the gaming platforms to broaden awareness, however the Help for Heroes charity has created its own gaming platform which allows people to both play and raise funds at the same time.
And in a world – sorry – metaverse, where the opportunities are endless, there is even scope to immerse donors into the situations of the causes they’re supporting, e.g. Virtually walking through a natural disaster zone, could give the supporter a ‘real-feel’ for the devastation that their donation is helping to ease.
Or offer the opportunity to run a virtual Marathon, which looks real in the metaverse but in reality is just people running on their treadmills at home.
There’s a real opportunity to offer new and exciting ways to engage potential supporters and the next generation of donors within the virtual world, and therefore the advent of the Metaverse certainly shouldn’t be ignored!
What is cryptocurrency… and NFTs?
Cryptocurrency (also known as crypto) can be considered as the ‘financial system’ of the Metaverse. A digital currency, cryptocurrency is designed to work as an online medium of exchange to buy goods or services securely. It uses cryptography and works on blockchain technology to secure and verify transactions. Cryptocurrency also differs to ‘old money’ in the sense that it is decentralised and exists using a peer-to-peer system, circulating without the need for a central monetary authority like a bank or government.
Are NFTs (non-fungible tokens) cryptocurrency?
No, NFTs are ‘digital assets’ that convey ownership of what could be considered an original copy of a digital file, and can be likened to a digital certificate of authenticity, that serves as proof of ownership. But they do share many similarities with cryptocurrencies, and they can be bought and sold in many of the same marketplaces. Currently many NFTs of value are found in the form of digital artwork, but NFTs could be a piece of music, a video or even as screenshot of a tweet… as seen in the selling of Twitter boss Jack Dorsey’s first tweet – it sold for a breath-taking $2.9m as an NFT!
Ok, enough of the techno-babble, can charities benefit from cryptocurrency and NFTs?
Crypto donations have seen a steady increase since 2021, not just in donation volume but also in the number of charities accepting crypto; although popularity currently remains more so in the US. More organisations are however beginning to see the benefits of raising funds with digital assets and NFT donations.
Although slow on the adoption, some charities in the UK have indeed already benefitted from cryptocurrency donations. The Edinburgh Dog and Cat Home in Scotland benefitted from ‘the Pawthereum community’ which donated approximately £87,000 to the charity last year – funding the charity’s pet foodbank service for the whole of this year!
Some charities are also already starting to think about how they can benefit from the auction of NFTs with platforms emerging who intend to use NFTs as a ‘force for social good’, committing a percentage of NFT sales to social causes.
There is also the option for charities themselves to create original NFTs themselves and sell them through their own online shop or a third party. Youth charity ‘One Young World’ is said to be the first charity in the UK to sell NFTs directly to raise money, offering five original pieces of digital art by an ambassador of the charity, available for the public to bid on or buy.
But I’ve heard they’re bad for the environment?
Unfortunately yes! The use of high-powered computers and the power of processing needed to ‘mine’ cryptocurrency, is having a devastating impact on the environment. (ie. high-level power usage = energy consumption = carbon emissions).
And it’s not just cryptocurrency, according to research, selling one piece of NFT ‘artwork’ has a carbon footprint equivalent to a one-hour flight.
“The amount of electricity consumed by bitcoin mining a year could boil enough water for all cups of tea consumed in the UK for 30 years.”– Cambridge Bitcoin Electricity Consumption Index.
There are developments on the horizon however, for more sustainable systems that will decrease energy use considerably.
It’s also worth noting with regards to cryptocurrency, that, whilst it’s in its infancy and being volatile in nature, it would be best for charities to be cautious in their approach to this digital currency alternative, but nonetheless advantageous to consider looking at how they can engage with existing cryptocurrency communities. The advice and trend in the short-term, therefore is for any charities who do accept cryptocurrency, to convert them as soon as possible into traditional currencies.
The Charity Commission offers advice in its recent blog ‘Cryptocurrencies: what are they, and should charities use them?’
Whilst a ‘Chief Metaverse Officer’ or ‘Crypto Exec’ might not yet be high on the hiring list and these movements in technology may not have a direct effect on you or your charity organisation, it’s certainly important to be aware of developments and to keep abreast of technology advancements to see where you can take advantage of the key trends.