Crypto has changed the way people think about ownership, transfer of value, and financial autonomy. It’s also changing the way people approach philanthropy.
For many donors – especially those holding valued cryptocurrencies – donor advised funds (DAFs) have become one of the most flexible and powerful tools for charitable giving.
This article explains what DAFs are, how they work, and why they are particularly well suited to crypto-based philanthropy.
What is a donor advised fund?
A donor advised fund is a charitable giving account administered by a registered nonprofit sponsor. When you contribute assets to a DAF:
- You are making an irrevocable charitable contribution
- You generally become eligible for an immediate tax deduction
- You can then allocate your donations to qualified charities over time
In simple terms, a DAF allows you to separate the timing of the charitable deduction from the timing of the grant recommendation. You give now, get the tax benefit, and decide later which charities to support (and when).
Why DAFs are particularly attractive to cryptocurrency holders
Donate crypto, get tax benefits
One of the most important benefits of donating crypto through a DAF is tax efficiency. Capital gains are avoided because the asset is given in kind and is never sold by the donor.
When donating appreciated crypto directly to a DAF:
- You avoid paying capital gains tax on the difference between your cost basis (purchase cost) and the current fair market value. of the appreciated crypto asset.
- You are eligible for a deduction for charitable donations, subject to deduction limits, based on the fair market value of the given crypto.
- Donating the appreciated cryptoasset directly to charitable causes allows more of the asset’s value is donated to charitable causes instead of taxes.
For long-term crypto holders, this can significantly increase the charitable impact compared to selling crypto and donating money.
Support thousands of charities from one account
DAFs are designed to be flexible. Most support a wide range of U.S. registered charities, one-time or recurring grants, and multi-year giving strategies.
Instead of coordinating separate donations, receipts and records across numerous organizations, donors can centralize their donations into a single account and distribute funds over time.
Invest your contributions while you plan your gift
Many DAFs allow donated assets to be invested after the contribution, but before they are given to charity. This means assets can continue to grow tax-free in the charitable accountdonors can take a longer-term strategic approach to philanthropyand market timing pressure is reduced. Growth maximizes charitable impact.
For crypto-native donors accustomed to portfolio management, this investment flexibility is a natural fit.
Simplified record keeping and tax documentation
Charitable donations can become administratively complex, especially when donations span multiple assets and organizations.
CFOs simplify this by consolidate donation records, provide year-end tax documents and reduce paperwork and operational overheads.
This is especially useful for donors who contribute crypto, stocks, and cash throughout the year.
Flexible donation, without time constraints
With a DAF, there is no obligation to immediately distribute funds to charities. Donors can respond to urgent needs as they arise, plan their grants based on personal or business milestones, and develop a long-term philanthropic strategy.
This flexibility aligns well with the volatility and opportunity cycles common in crypto markets.
Crypto has always been about much more than financial innovation. It’s about expanding access, transparency and global coordination. Donor-advised funds extend these principles to philanthropy by providing donors with greater control, greater capital efficiency, broader reach, and less friction.
As crypto adoption grows, so does the opportunity to use digital assets not only as investments, but also as tools for significant long-term impact.
Crypto gains translate into lasting impact
Donor advised funds are not new, but their relevance has increased significantly in a world where wealth is increasingly held in digital assets. For crypto holders who want to give thoughtfully, efficiently, and at scale, DAFs offer a proven and powerful framework.
As charitable infrastructure continues to evolve alongside crypto, understanding options like DAFs is an important first step toward maximizing financial and social impact.
How to get started
Here are three established providers to consider if you want to explore DAFs further:
Dafy
Daffy is a modern, low-cost donor-advised fund that makes charitable giving simple and accessible. With a $25 sign-up bonus, it lets you contribute crypto, stocks, or cash from its iOS app or web platform, then donate to almost any 501(c)(3) public charity, from local schools to global aid organizations, without triggering capital gains on appreciated assets or creating additional hassle for the more than 1.7 million nonprofits it supports.
End
Endaoment is a nonprofit, technology-driven, donor-advised fund that enables donors to give more efficiently and with greater flexibility, all on-chain. It supports cash, cryptocurrencies, and other complex assets, offers robust grantmaking tools, and focuses on modernizing charitable infrastructure through donor-centric design.
Donation pact
Givepact is a donor-advised fund specifically designed for crypto-philanthropy, enabling transparent and tax-efficient donation of digital assets. It is designed for crypto-native donors who want a streamlined way to support verified nonprofits while aligning charitable giving with on-chain innovation and global impact.
Transforming crypto philanthropy into global financial empowerment
Kraken’s mission is to accelerate the global adoption of cryptocurrency so that individuals around the world can achieve greater financial freedom and inclusion. At its core, this mission reflects the belief that open and accessible financial systems can increase opportunities, reduce barriers, and empower people historically excluded from traditional finance.
Philanthropy plays a vital role in this vision by helping to fund education, infrastructure, advocacy and direct support to organizations working to build a more equitable global economy.
Donor-advised funds provide a unique and powerful, internationally available way for cryptocurrency holders to contribute to this progress. They enable gifting of digital assets in a tax-efficient manner, support long-term strategic philanthropy, and reduce friction in how capital is deployed. DAFs enable crypto-native donors to transform innovation-based wealth into concrete, lasting impact.
In doing so, they help align personal generosity with our broader mission – using cryptocurrency not only as a financial tool, but also as a catalyst for positive, global change.
This information is provided for general educational purposes only and does not constitute tax, legal or accounting advice. Tax treatment depends on your personal situation and applicable laws. You should consult your own tax advisor or other qualified professional regarding your specific situation.
