Why Web3 is important for charities

What is charity?

As a concept, ‘charity’ refers to the social contract we all enter into as members of a society. The social contract says that we have a responsibility to contribute towards the betterment of others in society even if we don’t know them.

As a behaviour, ‘charity’ is the fulfilling of that social contract. There are many many ways for individuals to commit private resources to public good. Those resources may be time, money goods, expertise, in fact anything with transactable value. Sure, some people choose to renege on their responsibilities, or even deny the contract exists, but such is the freedom of a democratic society.

As an organisation, a ‘charity’ tries to encourage people to fulfill the social contract in service of a particular cause. The wide variety of charities for the wide variety of causes allows for anyone to contribute towards a cause that matters to them.

What is web3?

Web3 encodes social contracts. It is computable law, or an executable Magna Carta.

Web3 provides a governance layer for the internet. It offers technologies and protocols that allow applications to enable a paradigmatic shift in how the transactable elements of society; money, data, rights & laws, are processed. It offers the possibility of moving from a centralised model, where we rely on an institution such as a bank to govern the exchange of money, to a decentralised system of processing money between people without intermediaries.

Web3 utilises blockchain technology as a tool for distributed consensus, or to put it another way, a means of everyone agreeing on something because everyone can see that it happened. A transfer of ownership of a unit of value is recorded, immutably, in a way that

Why is web3 important for charities?

As with all new technologies, web3 will enable charities do the same things in different ways, such as accept donation, but with cryptocurrencies rather than fiat, and run charity auctions, except with NFTs rather than physical goods. Charities will start with this type of incremental innovation. But, and far more importantly, it will empower them to do different things. Charities will create radical innovation. Charities will create dramatically different ways to achieve their charitable purposes, and enable people to contribute to a cause and fulfill the social contract.

Web3 drastically alters the need for centralised institutions. As Decentralised Autonomous Organisations become better understood, providing a means of moving the bye-laws and decision-making of an organisation into smart contracts, a charitable organisation acting as intermediary to manage the distribution of donations will be replaced with peer-to-peer networks, with governance encoded into a smart contracts, and with the supporter members of the organisation having equal voting rights about how the rules of those smart contracts are written.

This future frees the charity from dependence on other centralised institutions like banks and marketing platforms too. When the next big social network emerges to replace Facebook and Twitter it will be built on the blockchain. As users migrate to a platform that doesn’t trap them by locking-in their data so they can be advertised at, so to will charities move their social marketing and find new ways to connect people to causes.

The labour market of the web3 future won’t have employees. Charities will offer up contract work with the briefing, completion and payment all handled through smart contracts. DACO’s will have no need for large teams across multiple departments, only hiring in developers to create smart contracts that govern the work.

What might a web3-enabled charity sector look like? No one knows yet. But it will come.