We know. We get it.
When most people think of non-fungible tokens (NFTs), their first thoughts are the eye-popping prices. Bored Apes selling for millions of dollars. Generative art rolling out hundreds of thousands in auction proceeds. As some might say, “Show me the money.”
But in many corners of this new technological space, a cohort of individuals and teams are using NFTs for another purpose, one with a decidedly more wholesome intent. These are the non-fungible tokens for social impact, and they span the spectrum of donations, altering relationships between donors and non-profits, and even preserving endangered cultures.
This article is a spotlight on those entities, the ones leveraging the technology for a different purpose. At the end of this guide, you’ll know:
- NFT teams that are donating sales and royalty proceeds to charity
- How NFT technology is overhauling the relationship between donors and organizations
- The drive to use NFTs and other Web3 tech to preserve endangered cultures
- And a big one: How some teams are using NFTs to fight climate change
Ready? Let’s rock and roll.
NFT Projects with Good Causes: How it Works, and a List
A lesson in NFT history: During the big bull run of 2021-2022, it wasn’t all about the money. Certainly, billions of dollars were pouring into the NFT space, with users speculating on even the most suspect projects. But late in 2021, a trend began to emerge: The charity-driven mint roadmap.
Essentially, projects had a mint checklist. When a certain number of NFTs were minted, the team would do something. Often, it would be small, like opening the Discord or doing a giveaway. But some teams took it a bit further: Donations to non-profits with good causes. For instance, take the popular NFT project World of Women.
For its secondary collection, World of Women Galaxy, the team donated 7.5% of its mint revenue to three charities: She’s The First, Too Young to Wed, and Strange Cintia. Many other collections have followed a similar pattern, donating to nonprofits far and wide. Two nonprofits that repeat often in the NFT space are ‘Girls Who Code’ and ‘Malala Fund.’
Other NFT collections that have a social focus include:
And then there’s this: Yuga Labs, the creators of Bored Ape Yacht Club, donated $200,000 in 2021 to a charity protecting orangutans in Borneo and Sumatra. Even the top dog in the space has given back.
Nonprofits and NFTs: Changing Donor Relationships
Although many people think of non-fungible tokens as pictures, they really are a type of technology with massive potential. And in that potential lies opportunity, one that charities around the world have (and can be) tapping into. First, a quick definition:
Non-fungible tokens stand for unique assets stored on a digital ledger known as a blockchain. NFTs create scarcity in the digital landscape. Rather than a file spread around the internet at the will of users, NFTs are owned by individuals who have virtual wallets, who can then buy, sell, and trade these assets.
And anyone can tap into that power.
As other publications have noted, here are some novel ways that nonprofits can take advantage of NFT technology:
- Raising funds through the issuing of NFT collections
- Taking advantage of perpetual royalties from NFT sales
- Creating a community around the NFT collection and the charity’s cause
- Changing the relationship between the donors and the charity through NFTs
It’s the last two points that are perhaps the most interesting.
First, like many other NFT teams, nonprofits can create a community surrounding their non-fungible tokens, building stronger bonds between donors and organizations. They can set up a Discord, have donors talk to one another, and establish a group that will continually support the nonprofit. They can even recognize collectors who are hold many NFTs.
Then there is the relationship component. Take this example.
Two organizations — Netherlands-based Coorest and PLCnetwork of the Southern Hemisphere — teamed up to ‘tokenize’ endangered animals. These NFTs allow holders to sponsor an elephant, lion, cheetah, or rhino, with the metadata for these tokens featuring information about the animal, including species, age, and gender. The organizations have also invited holders to the reservations to meet the animals.
Through NFTs, donors can have a personal connection to the cause. Rather than a simple donation that deducts from a checking account, they can relate to the cause in a more intimate fashion, another stepping stone to building a relationship with the nonprofit. This is another way that NFTs are changing the world for social good.
How the United Nations Is Using NFTs for Impact
The United Nations (UN) is an intergovernmental organization aimed at bringing peace and security throughout the world. But given its stature, you might think it wouldn’t dip into the wild world of Web3. Fortunately for the causes it supports, it has.
In early 2022, the UN released an NFT collection on the Ethereum blockchain called Patchwork Kingdoms. The art for each token was based on data visualization, with the top half of the pieces showing a school that had internet connection and the bottom a school that didn’t. For the collection, the UN partnered with artist Nadieh Bremer. Here is an example:
The collection benefits the United Nations International Children’s Emergency Fund (UNICEF) and its mission to bring internet connectivity to all the world’s schools. The goal is important: UNICEF believes that internet connectivity will allow children to tap into the digital revolution, which could change lives.
So far, the collection has had 139 ETH ($228,794) in trading volume. With a creator’s royalty rate of 20%, Patchworks Kingdom has raised an additional $46,000 for UNICEF after mint. It shows that even large government-related agencies are taking advantage of the new technologies to do some good.
Preserving Culture through NFT Technology
There is little doubt that globalization has benefited society, speeding up innovation, increasing trade, and ultimately leading to fewer wars than in the past. However, it has had an unexpected consequence: the decline or near-extinction of cultures and languages around the world. Now, through NFT technology, we have an opportunity to reverse that trend.
In March of this year, a deputy of Indonesia’s Ministry of Tourism and Creative Economy said that NFTs, along with cryptocurrency, will play a role in preserving the island nation’s culture. Other groups have already moved, creating virtual tourism experiences in the metaverse or NFT collections that celebrate their culture.
One such instance occurred in China. There, Tencent partnered with Dunhuang Academy to convert the prehistoric wall paintings of the Mogao Caves into an NFT collection. That location, already a UNESCO World Heritage site, is now available for anybody to view in digital form, a preservation of culture and a look into the past.
NFTs provide unique opportunities for preserving culture. Through metadata, compiled in the Interplanetary File System, countless information can be stored along with the art itself, creating a picture of the society that a collection is preserving. And there is the combination of the metaverse and NFTs as well: Tourism sites can be etched into history or recreated, with NFTs acting as a keepsake — a part of the culture that individuals can virtually take with them.
Infrastructure: How NFTs Are Battling Climate Change
Many believe that non-fungible tokens are bad for the environment, and that argument held some degree of weight in 2021, when Ethereum, the most popular blockchain for NFTs, ran on the Proof-of-Work consensus mechanism. But not only have NFTs become mostly net neutral for carbon emissions, they are helping the fight against climate change. Here’s how.
The carbon credit market, which many companies use to offset C02 emissions, is often messy. There is little integrity to the market, a lack of transparency, and the result is an actual increase in emissions, because companies are purchasing credits from organizations that may not be fulfilling the requirements.
This is where Web3 and NFTs come in.
In 2023, various carbon credit organizations have started to tokenize the credits, a manner of putting them on the blockchain. This has several benefits, including an increase in transparency and an easier ability to trade them. With NFTs, organizations can put in metadata — what exactly the carbon credit signifies (cattle removed from land or a tree planted, for instance).
By tokenizing these credits, there may also be additional legitimacy. People can know that the organization issuing the carbon credits they are purchasing has been verified, that their work is legit. NFT carbon credit marketplaces also simplify the messiness of the process, opening the trading of carbon credits to the average person who just needs to know the basics of Web3 to purchase.
Some of the organizations at this cutting-edge NFT space are:
As this novel approach to NFT technology emerges in the next few years, carbon credit buying and selling may become as common as trading other collectibles. But with the specific benefit of helping the environment.
Moving Money at Scale: A Case Study
On February 24th, 2022, Russia invaded Ukraine in an escalation of a conflict dating back to 2014. The world was shocked, and the market showed it: volatility in the stock market, trouble in crypto. But quickly, the Web3 community responded.
In a post on February 26th, just two days later, the Ukraine government issued a post on X, saying “Stand with the people of Ukraine. Now accepting cryptocurrency donations. Bitcoin, Ethereum, and USDT.” The message came with two wallet addresses attached, one for BTC and another for ETH and USDT.
By March 11th, $63.8 million had been raised. As of the time of this writing, that number was swelled to $458 million. Donations did not just occur in cryptocurrency as well. NFTs were sent to the ETH address, including a CryptoPunk valued at $200,000. It was a demonstrable show of force from the Web3 community, and it showed the power of blockchain technology.
NFTs, just like with cryptocurrency, can be moved at any moment, for any reason. There are no banks to go through, no gatekeepers. Money can go to an organization faster than ever. And it can do so at a scale not seen at any other time in history.
As the godfather of the NFT space, 6529, once said, the ultimate utility of cryptocurrency is to move money at scale. And that moment when other people realize this utility may be approaching sooner rather than later. For organizations built around a social cause or mission, little could be better. It’s another example of how NFTs — and Web3 tech — are being used for social good.
From NFT projects donating funds to the UN and tokenized carbon credits, to moving money at scale, NFTs have become a way to contribute to the good of society. And, as these examples show, even during a winter that has depressed prices of major collections, innovation is still occurring.
They say bear markets are for builders. Who knows what new way NFTs will be used next.