32 nd CIRIEC International Congress

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1 32 nd CIRIEC International Congress AWARENESS AND ATTITUDES TOWARDS DIGITAL CURRENCIES IN NON-PROFIT ORGANIZATIONS: AN ANALYSIS FROM TURKEY Semra BOĞA, PhD Istanbul Gelişim University

2 Background of the Research By the beginning of 20th century, with exponential rise in technology, the world witnessed tremendous innovations in diversity of fields The fourth industrial revolution bringing a digital transformation reshaping economic, politic and social systems Semra BOĞA, PhD, Istanbul Gelisim University 2

3 Background of the Research The digitization of money with blockchain technology seem to have an impact on philanthropy The aim of the study is to reveal the tendency of non-profit organizations in Turkey towards accepting cryptocurrencies for donation Semra BOĞA, PhD, Istanbul Gelisim University 3

Evolution of Money: From Barter to Cryptocurrency Fiat money which is the most important element of the modern economic system has also begun to give its place to digital money by having undergone a

4 Evolution of Money: From Barter to Cryptocurrency Fiat money which is the most important element of the modern economic system has also begun to give its place to digital money by having undergone a significant transformation during digitization process With the emergence of technologies like big data and blockchain, digital money has begun to be transformed into cryptocurrencies Semra BOĞA, PhD, Istanbul Gelisim University 4

Blockchain: the Technology Behind Cryptocurrencies The Blockchain is a public and transparent ledger runs on peer-to-peer (P2P) network of computers Its decentralized

5 Blockchain: the Technology Behind Cryptocurrencies The Blockchain is a public and transparent ledger runs on peer-to-peer (P2P) network of computers Its decentralized structure allows the users trust the transactions based on mutual agreement in the system, eliminating single authority trust Semra BOĞA, PhD, Istanbul Gelisim University 5

6 First used in 2009 by Satoshi Nakamoto for bitcoin, the first cryptocurrency which caused the blockchain technology and bitcoin used synonymously Semra BOĞA, PhD, Istanbul Gelisim University 6

Blockchain: the Technology Behind Cryptocurrencies The blockchain technology can be used for smart contracts, the sharing economy, crowdfunding,

7 Blockchain: the Technology Behind Cryptocurrencies The blockchain technology can be used for smart contracts, the sharing economy, crowdfunding, governance, supply chain auditing, file storage, market predictions, protection of intellectual property etc Semra BOĞA, PhD, Istanbul Gelisim University 7

Cryptocurrency Market The number of cryptocurrencies is over 1600 and the number is growing All cryptocurrencies have different features and

8 Cryptocurrency Market The number of cryptocurrencies is over 1600 and the number is growing All cryptocurrencies have different features and different blockchains based on their algorithmic structure which make them useful for specific purposes Semra BOĞA, PhD, Istanbul Gelisim University 8

9 Cryptocurrency Market The total market capitalization value of cryptocurrencies is approximately $400 billion The volatility in cryptocurrency market is very high Semra BOĞA, PhD, Istanbul Gelisim University 9

10 Market Capitalization of Cryptocurrencies (Billion $) Bitcoin Ethereum Ripple Bitcoin Cash EOS Cardano Litecoin 79 Stellar Semra BOĞA, PhD, Istanbul Gelisim University 10

11 Bitcoin Volume in Turkey Source: coin.dance.com Semra BOĞA, PhD, Istanbul Gelisim University 11

12 Fundraising with Cryptocurrencies WikiLeaks was the first non-profit organization accepted bitcoin donations in 2011 Red Cross, Save the Children, United Way, Electronic Frontier Foundation, the Water Projects are some of the other bitcoin accepting charities Fidelity Charitable received $60 million donation in cryptocurrencies in 2017 while it was $7 million in 2015 and 2016 Semra BOĞA, PhD, Istanbul Gelisim University 12

13 Fundraising with Cryptocurrencies (2) According to the report of the UK Charities Aid Foundation blockchains can increase transparency, openness and trust whilst reducing transaction costs and providing new opportunities for fundraising Semra BOĞA, PhD, Istanbul Gelisim University 13

14 Fundraising with Cryptocurrencies (3) Bitcoin donations can be received directly online by the organizations or through foundations such as BitHope, BitGive, BitPay, Bcharity and the Helperbit Semra BOĞA, PhD, Istanbul Gelisim University 14

Cryptocurrency Donations in Turkey In Turkey there exists more than 100.

15 Cryptocurrency Donations in Turkey In Turkey there exists more than charities and 5000 foundations, however currently only 1 of them accepting donations with Bitcoin Semra BOĞA, PhD, Istanbul Gelisim University 15

Cryptocurrency Donations in Turkey (2) Based on the interviews conducted with the representatives of 114 charities and foundations, the reasons behind the reluctance to accept donations with bitcoin:

16 Cryptocurrency Donations in Turkey (2) Based on the interviews conducted with the representatives of 114 charities and foundations, the reasons behind the reluctance to accept donations with bitcoin: No awareness about the possibility of accepting bitcoin donation Even though most of the non-profit organizations have heard of bitcoin, they are not aware of the possibility to receive donations with bitcoin Semra BOĞA, PhD, Istanbul Gelisim University 16

17 Cryptocurrency Donations in Turkey (3) Bitcoin legislation is still unclear in Turkey There is no law in Turkey that bans the use of crypto currencies except for illegal activities Semra BOĞA, PhD, Istanbul Gelisim University 17

18 Cryptocurrency Donations in Turkey (4) Turkish Central Bank stated that bitcoin and crypto currencies could contribute to global financial stability thanks to its decentralized and peer-to-peer financial network Turkish Banking Regulation and Supervision Agency published a press release to warn the bitcoin users about its risks Semra BOĞA, PhD, Istanbul Gelisim University 18

Cryptocurrency Donations in Turkey (5) No adaptation to digital transformation Very limited number of charities and foundations have a web site and social media profiles

19 Cryptocurrency Donations in Turkey (5) No adaptation to digital transformation Very limited number of charities and foundations have a web site and social media profiles Accepting donations digitally is not common within the ones using web sites, they provide an account number for money transfers Semra BOĞA, PhD, Istanbul Gelisim University 19

Cryptocurrency Donations in Turkey (6) Skeptical about the potential of cryptocurrencies Most of the non-profit organization do not believe in the

20 Cryptocurrency Donations in Turkey (6) Skeptical about the potential of cryptocurrencies Most of the non-profit organization do not believe in the potential of cryptocurrencies to engage more donors Cryptocurrencies reputation on money laundering Semra BOĞA, PhD, Istanbul Gelisim University 20

Cryptocurrency Donations in Turkey (6) Tax and accounting issues It is by the law still unclear how to treat bitcoin; as money or property It is not clear how to report bitcoin

21 Cryptocurrency Donations in Turkey (6) Tax and accounting issues It is by the law still unclear how to treat bitcoin; as money or property It is not clear how to report bitcoin donations to tax authorities either when kept as bitcoin or converted into cash Belief about the anonymity of cryptocurrency transactions Semra BOĞA, PhD, Istanbul Gelisim University 21

22 Conclusion Awareness, adoption, and use of crytptocurrencies within the non-profit organizations in Turkey is quite low Regulations and tax applications for the cryptocurrencies should be clarified Blockchain technology is still in its infancy in the world, however, it has the potential to revolutionize the non-profit sector Semra BOĞA, PhD, Istanbul Gelisim University 22

23 Thank you for your attention Semra BOĞA, PhD, Istanbul Gelisim University 23

BOLENUM. White Paper February 2017

BOLENUM. White Paper February 2017 BOLENUM White Paper February 2017 Contents Background 3 The Issue 4 The Solution 5 The ICO 7 Background The creation of cryptocurrency in 2009 was a technological revolution. In the eight years since,