Nonprofits are finding new virtual ways to fundraise during the COVID-19 pandemic — including through the use of non-fungible tokens (NFTs).

NFTs, or one-of-a-kind digital assets, can be bought and sold like any other piece of property.

Macy's and the Make-A-Wish Foundation recently teamed up to sell NFTs of classic balloons from past Macy's Thanksgiving Day Parades. One of those NFTs sold for tens of thousands of dollars.

All of the proceeds from the NFT sales go to the Make-A-Wish Foundation. In addition, 10% of the NFTs' resale value will automatically be donated to the foundation if they are resold.

"There is an insight that sometimes people like to have something in exchange for giving with philanthropy," said Janell Holas, the VP of brand and marketing with Make-A-Wish America. "Oftentimes, there's something that can be a badge of honor for giving, so NFTs are a wonderful way for people to give back to organizations that they care about while also having something that's really a token of their support, as well as a sense of pride, a way that they can really show that they've given back."

Holas says Make-A-Wish relies on partners like Macy's, who have expertise in emerging fields like NFTs, to address potential risks.

One such risk is the ambiguity around how NFTs could be regulated in the future.

"I would argue that it's important to have these conversations and to try to, at the very least. integrate the option of crypto-based donations and NFTs into ongoing operations going forward because of the way in which transactions are happening has already changed, and the overall marketplace is just catching onto that right now," said Sean Smith Stein, who studies NFTs and cryptocurrency.

Smith Stein sees the benefit of nonprofits using NFTs for fundraising because of the lower cost of processing a donation than a credit card. He also adds that the money is available instantly, which is not the case with other types of donations.

Holas says people who give to the Make-A-Wish Foundation are focused on the need that exists right now.

"The reality is for every wish we're currently granting, there are three more children who are waiting for their wishes to be granted," Holas said. "The only thing standing between us and being able to grant those wishes for children who are waiting is increasing our fundraising and being able to raise the revenue we need to grant those wishes."

Make-A-Wish says the majority of kids say getting their wish granted was the turning point that helped them overcome their circumstances.

As interest in cryptocurrencies continues to grow, the number of people using them to donate to charity is increasing as well.

United Way Worldwide has seen a 350% increase in crypto donations in the last 12 months compared to the year before.

And it's not limited to United Way. A Giving Tuesday event focused on crypto giving for 1,000 nonprofits raised millions of dollars in a single day.

"We're seeing that we're we are actually tapping into a new demographic and a new generation, and it's just great to be early and be able to provide them with the opportunity to make an impact," said Edwin Goutier, the VP of Innovation at United Way Worldwide.

Goutier says 80% of visitors to the bitcoin section of United Way's website are men who tend to be younger. That's compared to the rest of their website, where visitors are 80% women who tend to be middle-aged.

Rick Cohen with the National Council of Nonprofits says cryptocurrencies only make up a small portion of donations to nonprofits — something that the United Way says applies to them as well.

"I don't know that cryptocurrency will get to the place where it's taken over from regular contributions of dollars, but it's something that over time, as nonprofits hear that it's something their donors want to be able to utilize, they'll go ahead and implement it when it makes sense for them," Cohen said.

Small nonprofits are still approaching crypto giving with caution.

"It can be a bit volatile in value, and so it's also something where it's new to a lot of folks. particularly when you're talking about smaller nonprofits that don't have a lot of infrastructure. that don't have financial experts on staff or even someone with a lot of financial expertise able to advise them," Cohen said. "It's something they're they're nervous about."

United Way protects itself from market volatility by automatically selling the cryptocurrency as soon as they receive it.

Nonprofits are also watching how Washington could regulate cryptocurrencies in the future.

"What I do think will happen in the future, as more and more cryptocurrency adoption takes hold, is we'll see vendors that typically already served nonprofits added as just a native payment type," Goutier said. "So right next to PayPal, right next to Apple Pay, you'll start to see more cryptocurrency options, but I think that's still a few years out."

Nonprofits need help this holiday season, no matter how donations are given. Cohen says smaller local nonprofits especially have seen giving go down, and relief funds that kept them going during the pandemic have run out.