Ask HN: How to give cryptocurrency to people in need?

14 points by joewaltman 7 years ago | 32 comments

My name is Joe Waltman and I a recently started working with GiveCrypto.org (https://www.givecrypto.org/), a non-profit that was started by Brian Armstrong. I somewhat stumbled into this job after my previous company (VetPronto) went out of business. I am far from an expert on cryptocurrency and have zero experience working with non-profits.

GiveCrypto.org aims to help by making direct transfers of cryptocurrency. There is a growing body of evidence suggesting that the best way to help poor people is to give them cash, rather than traditional support like food, medicine or training.

One of the big challenges for GiveCrypto.org is finding people that are both in need and can use cryptocurrency. I've done some experimentation (https://medium.com/givecrypto/givecrypto-work-trial-a-new-fi...) and it is a quite a brain teaser. There is a sad irony wrapped around this problem; the poorer you are, the more 'expensive' it is for you to make use of cryptocurrency. I'd love to tap into the HN network to help brainstorm clever ways to get cryptocurrency into the hands of people that need it.

Thanks in advance.

publicfig 7 years ago |

I can't think of a situation where a donating cryptocurrency would be better than a donation of fiat cash to the same groups. Honestly, I can only see negatives from going down that route (lack of accountability for fund usage is a major one) and very few, if any, positives. If the concern is volatility of the local fiat currency, make the donation in another more stable currency. Cryptocurrency will only add to that instability.

>There is a growing body of evidence suggesting that the best way to help poor people is to give them cash, rather than traditional support like food, medicine or training.

I've not seen this (but have seen the inverse often); do you have any references or examples?

NeedMoreTea 7 years ago | |

Not OP, but I've seen suggestions that it should replace aid[0] if mild conditions are attached to the cash grant. There is, of course, the recent re-analysis of Mincome, Manitoba's well known Basic Income trial[1] that found numerous unintended, positive consequences like fewer hospital visits.

[0] https://www.economist.com/international/2013/12/12/pennies-f...

[1] https://en.wikipedia.org/wiki/Mincome

cameldrv 7 years ago | |

The reason people want to give crypto is because they haven't reported it to the IRS. There are a lot of people with big gains in crypto that they should have reported years ago, and they're not sure what to do with it now. If they can directly give it without a reporting requirement, they're happy. Perhaps there's a secondary (primary?) business in people receiving anonymous donations from a generous benefactor, which they then are able to report as income and get square with the government without admitting to underreporting income.

drivingmenuts 7 years ago | |

> lack of accountability for fund usage is a major one

So you give them money and then tell them how they can use it? I thought the whole point of giving them cash was to allow the recipient to determine how best to use it, given their circumstances at the time.

publicfig 7 years ago | | |

Likely with most organizations built around donating funds to pre-existing efforts, the lack of accountability would come from the NGO/Government Organization itself, who (for better or worse in terms of enforcement) often have regulations in regards of spending donated funds in terms of documentation and accounting.

joewaltman 7 years ago | |

This is probably the best report on the cash vs. in-kind question - https://www.odi.org/publications/10505-cash-transfers-what-d...

Finnucane 7 years ago |

>There is a growing body of evidence suggesting that the best way to help poor people is to give them cash

Then why not just do that, then?

joewaltman 7 years ago | |

I agree that fiat currency would be more useful if the recipient lives in a place with a functional financial system and/or a competent government. However, in places where money is broken (i.e. venezuela) or government is broken (i.e. refugee camps), it is possible that a crypto-currency might be more useful than fiat.

gamblor956 7 years ago | | |

There is no situation in which you have a broken government (i.e., refugee camps) where it is possible that crypto-currency will be useful. In refugee camps, even the doctors and aid workers have minimal access to the internet, and certainly not the type of stable connection you would need to transact crypto. Moreover, you would have extreme difficulty finding counterparties for the crypto-fiat exchange that don't charge usurious rates.

In situations where you just have broken governments, like Syria or Somalia, you generally also have broken utilities and private services, and internet is definitely low down on the list of priorities when you're worried about basic survival.

Finnucane 7 years ago | | |

In Venezuela, only the local currency is a problem. You could still send dollars. And refugee camps, might be better off getting food and medicine directly.

masukomi 7 years ago | | |

It's common knowledge that refugees streaming across border regularly bring computers, cell phones, solar panels, and large batteries to keep all those things going. Plus unlike most people in first world countries, most refugees are well versed in cryptocurrency wallets, trading, and the relative value of those coins to the daily needs of life like bread, and vegetables.

.... end sarcasm.

gfarah 7 years ago |

One group of people desperately in need is Venezuelans. You could circumvent the government restrictions and install a form of Exchange in neighboring towns of Colombia e.g Cúcuta. This would be more helpful than cash because 1. They can’t receive/withdraw money in Venezuela at this point reliably 2. They will know they have money saved for their journey out of Venezuela in Colombia and will take the decision to leave the country now.

Source: I live in Colombia and talk with Venezuelans all the time about their situation.

piano 7 years ago | |

This is the n-th time I'm reading a suggestion to help Venezuela using Bitcoin/cryptocurrencies. I wonder whoever came up with this and whether there's any save reasoning behind it or if it's just a cryptonerd fantasy. Venezuela has a very low average internet connection speed, reportedly one of the lowest in the world. Sources I've found say it's no better than 2 Mbit/s. On that speed, downloading the current Bitcoin blockchain would take about 18 days.

With such an internet infrastracture, is the country even capable of maintaining an up-to-date connection to the bitcoin network?

andirk 7 years ago | | |

The full bitcoin blockchain from Satoshi's first transaction is huge, but that's for a "full node". A "lightweight node" needs much less https://en.bitcoin.it/wiki/Lightweight_node . The amount of internet connection needed is fairly minimal.

Ecuador moved to the US dollar in 2000 because their handling of their own currency wasn't working (and maybe because oil is often traded in USD?). Whether Venezuela uses BTC or some other currency sounds like a good idea at this point. The corrupt actors in their monetary system probably want people to keep using their bolivar though, because that's what the corrupt people stole, are holding, and printing.

sanityvampire 7 years ago |

No offense, but "let's give the poor people cryptocurrency" reads a lot like the start of a satire piece, a lampoon of out-of-touch Bay Area tech culture denizens.

Jeremy1026 7 years ago |

Step 1: Convert to fiat currency.

Step 2: Give them cash.

nofunphil 7 years ago |

1. Target specific towns and villages in need; perhaps anywhere M-Pesa is used is a good place to start??

2. Hire mobile money agents in those places to facilitate crypto to fiat exchange (when necessary)

3. Monitor progress extensively.

4. Incentivize merchants in the selected towns and villages to accept crypto for payment (granted, easier said then done, but I have some ideas there as well)

X6S1x6Okd1st 7 years ago |

Focus on places that already have good cell network/free wifi penetration and smartphones.

https://en.wikipedia.org/wiki/List_of_countries_by_smartphon...

People aren't going to care much unless they can spend it though. Maybe find places that have a higher concentration of places that accept cryptocurrency and focus on those? Maybe Ghana, China or Nigeria?

https://coin.dance/volume/localbitcoins

Senderman 7 years ago |

Hi Joe.

This answer is a bit rambly, but I think my subconscious has a point to make, and I'm trying to tease it out.

This may come across the wrong way, but: which poor people? Your town, your country, or your whole planet?

I'm not an expert, but my hunch is if you start with a very local project (depending on where you live, it shouldn't be hard to find your local poverty), you'll get the answers you need - and I think if you're going to make a big impact, it will grow from that.

When I lived in L.A., young-me sat down with someone I thought was homeless - a panhandling gent sitting on some steps in Hollywood - we talked, about a bunch of things, he told me about his routine. Said he made about 30 bucks at night at that spot - also turned out he had a home, so I'd made an incorrect assumption.

A lot of my friends thought it was pretty weird that I would engage with the guy. Guess they had bad experiences with similar situations? I don't know. I doubt it; I suspect people were afraid. But what do you have to lose?

Talk to some of the people you're looking to help. A few small things will stand out in your mind - scale those.

I'm jumping the gun here, but if your mind's reaction is that that's not 'global' enough - I don't think anything grows to be a global force without a solid kernel, and that should be able to succeed at a small scale.

For what it's worth, that's my take.

Best of luck.

zcopley 7 years ago |

The Steemit community seems to be giving crypto (steem)directly to Venezuelans in need. https://steemit.com/venezuela/@drutter/mission-agua-possible...

X6S1x6Okd1st 7 years ago |

Are y'all going to do work in the US? Maybe not long term, but potentially as a test case? Are you looking for part time or volunteer staff in those areas?