Charities are being urged to carry out risk assessments and due diligence before accepting crypto donations, according to latest guidance from the Fundraising Regulator.

The risk of a person behind the donation being linked to crime or an organisation subject to government sanctions is a particular concern charities need to be aware of.

Charities are also being urged to consider whether the environmental or social impact involved in crypto assets, which consume large amounts of energy to produce, are consistent with their values.

In a blog post explaining the new guide, the regulator’s director of policy Paul Winyard urges charities to ensure their trustees make a “proactive decision” on whether to accept crypto donations immediately “rather than waiting until one is offered”.

A risk assessment and due diligence should also be carried out if deciding to accept a donation, with particular attention to any criminal and environmental risks.

Staff, trustees, volunteers also need to “have the knowledge and training” to ensure they can manage crypto donations “confidently”.

“Doing this work in advance can help you identify and manage potential risks, instead of having to make important decisions when a donation is offered,” said Winyard.

Consideration also needs to be given as to whether third parties used also enable crypto donations and whether this is compatible with charities’ values.

Winward adds: “If you decide to accept crypto, be open with donors about your approach. For example, you could explain which types of crypto you accept, whether you accept anonymous donations and any other important features of your acceptance policy.

"Our message is simple: Be proactive in deciding whether crypto is right for your organisation, understand and manage the risks, and put the right policies, due diligence, systems and training in place.”

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