According to Funraise’s Global NGO Technology Report from 2019, 2% of fundraising was in the form of Cryptocurrency. Some of this is through established funds, like Fidelity, that seem to file Crypto donations as “Virtual Currency”. The largest single (direct) Crypto donation to a non profit that I could find is a $1.2 million donation to the Austin Community Foundation. As mentioned, the Giving Block, before it was acquired by Shift4 in early 2022, experienced a rise in donations by 1,558%. This is a large rise, but overall direct Crypto is still a small part of the total amount of fundraising.

The Giving Block was recently acquired by a large tech company called Shift4, whose owner has ties to Elon Musk and SpaceX. With Shift4, the Giving Block’s has a new philanthropic venture. It was created after its acquisition by Shift4, and includes matching $20 million in Crypto donations. It claims to be the largest Crypto based philanthropic venture ever, and from what I can tell that is the truth. This is interesting, as it is a tech company and its billionaire founder acquiring a company and using existing money to attempt to legitimize and normalize Crypto-based donations to non profits.

“ALLENTOWN, Pa.–(BUSINESS WIRE)– Shift4 (NYSE: FOUR), a leading provider of integrated payment and commerce technology, today announced the launch of the “Caring with Crypto” campaign to raise over $20 million for nonprofit organizations on The Giving Block, a cryptocurrency fundraising platform that Shift4 recently acquired. Shift4 CEO Jared Isaacman will personally match the first $10 million in crypto donations through the initiative, with the company aiming to create the largest cryptocurrency fundraising campaign in history.”

Below is an image from the letter sent to shareholders about the acquisition:

Shift4 also acquired Finaro. This is important for context as it shows the Crypto company’s value as it relates to other assets, and how Crypto donations are one part of the larger effort to expand Shift4. Shift4’s stock price has been dipping in the past year. It appears that the acquisition of the Giving Block corresponded to a small bump when it was announced but it has since dipped.

Why was the Giving Block acquired by Shift4 and why has Shift4 promised $20 million dollars? What does this tell us about the future of Crypto and nonprofits? I dug into Shift4’s messages to shareholders and filings with the SEC. In the below shareholder letter explaining the rational and foreseen benefits of the acquisition, we see that the Giving Block was part of a suite of acquisitions designed to prepare Shift4, an existing, powerful tech company, for the mainstreaming of Crypto and international financial transactions. It will be interesting to see if any of the promised benefits play out, or if the Giving Block was an effort to acquire some flashy crypto business, with the added benefit of good PR from philanthropy. It also seems that the focus on philanthropy, and the $20 million promise, is a way for Shift4 to use philanthropy as a way to mainstream Crypto outside of philanthropy and to have a major market position in that realm. I think that it is important for arts organizations to keep in mind the motivations behind Crypto donations, and the role that donations to nonprofit arts orgs will play in turning Crypto into something that is a mainstream source of power and influence for technology companies that are already established.

The recent SEC filing from Shift4 demonstrates that the company sees big money in the Crypto space, though the “cross-sell potential” part of this is vague. This resources is a good demonstration of the increasing role of established businesses in Crypto, and well known actors being the ones to gate keep Crypto donations in non profit spaces.

On February 28, 2022, the Company acquired The Giving Block, Inc. (“The Giving Block”) for approximately $13.5 million in cash, $40.5 million in shares of the Company’s Class A common stock and a performance-based earnout of up to $61.5 million in cash and $184.5 million in shares of the Company’s Class A common stock. The Giving Block is a cryptocurrency donation marketplace that the Company expects to accelerate its growth in the non-profit sector with significant cross-sell potential.

Ultimately, the story of the Giving Block and its acquisition is a demonstration of the efforts by existing power players to maintain their position in the Crypto space, and how non-profit donations are a way to achieve this purpose.

Bibliography

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Dalí Lives is an advanced instance of a growing phenomenon with the potential to disrupt both the art world and technologically mediated inter personal relationships. Ghostbots (sometimes called Griefbots) are an impending challenge for post mortem privacy and the arts space, and have found exploration in some recent socially conscious science fiction. This technology is defined loosely as efforts to use digital versions of an individual to recreate them in a way that can survive after the death of the individual. The first of these to gain major traction, Eternime, is now defunct after a period of media hype:

Two successors in the space, HereAfter AI and Replika AI, were both founded by computer scientists as projects to recreate specific individuals that they were hoping to memorialize. The ultimate fates of each of these projects is telling as to the future of this space. Replika does not recreate individuals, but rather uses input from individuals to create a digital friend. HereAfter AI is essentially a digital diary. For something like Dalí Lives to become mainstream for artists and for people seeking a form of digital immortality, something in between HereAfter and Replika needs to become widely available. HereAfter seeks to recreate an individual, while Replika applies machine learning to create generative conversations that an individual will respond well to. There is no bridge between this at the moment that is available without the resources of an entire museum. This has wide implications for who has the right to a digital immortality that is similar to the gate kept nature of most advanced AI – at the moment it is limited to those rich enough to hire a team of computer scientists and pay for the computing power, or to people who are already famous enough that organizations are willing to put in the effort and time to recreate them.

The consequences of poorly executed generative AI are vast – as it could lead to an individual or artist producing nonsensical or harmful conversations during an artistic expression or during conversations with close relatives. In scenarios where the artist or individual is deceased, there is no recourse if an AI is not representative of who they are, and there is a possible future to this technology where the quality of your digital afterlife is mediated by wealth. This is already present, as HereAfter AI and Mind Bank AI (discussed later) are very expensive. HereAfter AI relies on a paid, tier subscription model to maintain a digital afterlife. Like a Medieval Indulgence.

There is one other mass market Ghostbot/Griefbot that I found, Mind Bank AI, which markets itself as a “Digital Twin”. Mind Bank AI is a pretty shady company. Like HereAfter, I am unconvinced that their privacy practices are ready to handle the implications of a technology explicitly designed to gather the most intimate stories of a person’s life.

Mind Bank AI plays a slight of hand. It does not yet seem to use generative conversations. Instead, it draws people in with vague promises of self help and an eventual digital twin once AI technology has reached the point where it is possible. However, Dalí Lives proves that it is already largely possible, it is just gate kept by wealth and access to enough data about a person.

Mind Bank AI and Eternime are/were designed to be used for extended periods, possibly years, to gather enough data to recreate an individual. This is a reason why this technology is particularly suited to disrupt the arts space, as artists are likely to have vast banks of carefully crafted and stored records of their work, public appearances, and thought processes. Ghostbots, Griefbots, and Digital Twins are in very nascent stages, and are something to be watched along with privacy laws and the increased access to AI to people without vast resources and technology knowledge.

Bibliography

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Eterni.me links to this post from their now defunct url. It is 7 years old and seems to be the only remnant of the company left. I think it would be noteworthy to do a “where are they now” of the founders.

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