You were this many days old, when you realized that a nonprofit that is financed in Bitcoin has no inherent incentive to spend the money because the money goes up in value, while they sit on it.
Only a profit-driven company has an incentive to actively invest Bitcoin income, as they only pay out the _returns_ on that investment.
#economics #finance #NGOs
ten31 and opensats hmmm?
just a game of maintaining a balance between the fraction disbursed and spent on admin and the base principal that keeps growing in purchasing power
not hard to see that their ability to do this is only going to continue to increase over the coming decade
Hmmm… going to spend a few more minutes thinking about this one this morning…
I see now comments are around existing NPs which seem primarily tech/dev focused.
I’m really curious how this will affect social non profit orgs. Funding with bitcoin changes the incentives…
well, yes. investing used to be an adventure. You had to belive in the project as an investor. It's fiat what changed that. It's mostly misallocation of capital these days, because money are worthless
Well, with Bitcoin, money is the most valuable thing, so it also completely destroys the will to invest in anything that isn't life-sustaining.
as it should be?
Back to mud huts, but okay.
either you attract an investor or you sell your chairs. and toothbrush.
not ideal, but real (as opposed to fake)
But how to attract an investor, when there is an NGO giving everything away for free?
for now i think the moral capital buildup is doing fine, there will be at least subsistence level results in it once one shops the system around to a few people with running concerns and find users
it's not easy innovating, while VCs and grant NGOs are just exploiting the system
yes, the game is rigged. but won't be forever. At least that's my hope
the more we can grease the skids for people to exit fiat the faster the game is up, and this is a network effect so it may seem like we are making mere inches of progress towards our goal at this time but in the next decade it will all happen in a matter of weeks and ... well... i have visions of how it will look, it's gonna be lit 🔥
That's the hard part. I don't know. But it used to be like that. And I think it's right to be hard. The investment must be better then just savings. Bitcoin is still too speculative (in terms of fiat price), but when it's not I guess everything with potential of 20+% will be considered.
This is like trying to sell BMWs in a market where the government gives away Trabbies. Even if the BMWs are much better, you can't compete against Trabbies until the Trabbie production completely collapses and the question becomes "BMW vs nothing".
And, now, imagine the Trabbie producer has more Bitcoin than God.
And, now, imagine the Trabbie producer is _also_ producing free BMws.
idk what to say. sometimes you can't be profitable even with superior product.
the sad part is that somehow people prefer shitty products because the government pushed them.
this will end. we might be the generation which makes this shift. it will (and is) cost us.
but this will end.
Well, it's not the government, in this case.
I know, but it's them who corrupt the game
Regardless of whether Bitcoin or not, a nonprofit has a mission formalized in a charter that is the measure of its ‘success’. Not profit-driven, but outcome-based. Sometimes it’s tricky to measure and that’s where non-profits (including churches) get into trouble.
