Nonprofits need to weigh up the risk of volatility and hacks, and follow money laundering norms, the Charity Commission said.
English and Welsh charities accepting crypto donations should keep accurate records and comply with tax and money-laundering rules, the Charity Commission said in guidance published Wednesday.
The regulator warned charities that assets such as bitcoin (BTC) or non-fungible tokens (NFT) can be volatile, prone to hacks and hard to trace – and that they’ll need to weigh up whether it’s worth accepting them at all.
“Our guidance stresses the risks involved in the use of cryptocurrency, and advises trustees to exercise caution,” Helen Stephenson, the Commission’s chief executive officer, said in a speech also given Wednesday.
In a July 2022 blog, the Commission’s Assistant Director of Policy Sam Jackson said that crypto could become a “more mainstream route to investing, trading, and moving assets,” citing fundraising successes using digital assets in Ukraine, and the U.K.’s own goal to become a crypto hub.
The Commission, responsible for registering and monitoring nonprofits in England and Wales, in January said it was probing the Effective Ventures Foundation, which had received significant backing from Sam Bankman-Fried and his exchange, FTX, which filed for bankruptcy in November.
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