Impact of Blockchain on the Nonprofit and Voluntary Industry

Organizations now are not just talking about Blockchain but also applying it in different sets of industries varying from logistics to finance. That’s because of the improved security that blockchain provides.

The blockchain is not immune to hacking attempts contrary many people think that it is immune, but one of the reasons that people often are in favor of blockchain security is the way the blockchain’s distributed ledger technology lets no single vulnerability give cybercriminals access to all information at once.

Although some nonprofit industry insiders realize cybersecurity is a concern for their organizations, there is usually a gap between knowing that the dangers exist and taking action to prevent them. There are several reasons that can make nonprofits particularly prone to cyber-attacks. They often use old computer equipment with outdated and old software. In other scenarios, they may think they lack the resources to make cybersecurity a priority.

There’s also a common line of thinking due to which nonprofits assume that they won’t have the information hackers want. But, there’s always the financial information given by donors. That’s just one of the details that hackers could steal and exploit.

So it’s important for nonprofits to put a detailed cybersecurity plan in place, and a majority of them will do so after undergoing cybersecurity audits. The blockchain is still a relatively new concept of cybersecurity for nonprofits, but as technology would progress, it’ll likely play a more important role.

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It’s also quite important for nonprofits to develop a set of good practices for their staff and volunteers to follow while working for the organization. Some of the practices might include always logging out of internal interfaces and software after use and never sharing passwords with colleagues.

There’s also a possibility, too, that the blockchain would be able to make passwords even more secure—or make them obsolete. Several companies are researching ways to make the blockchain replace traditional passwords.

Data tampering happens during unauthorized changes to the user’s data. Acronis is a company that provides data storage powered by blockchain technology. It makes a cryptographic hash for each piece of stored data which acts as a fingerprint. The algorithm makes different fingerprints for each change in an input file, making it easy to catch any tampering.

According to research, there is decreasing trust in nonprofits from individuals in the U.S. There are unquestionably many reasons for that reduced trust, and the blockchain would not be able to target all of them. But, if people would worry about the security of their data after they come in contact with nonprofits, they’ll hesitate to volunteer or donate money to the organization.

The world’s largest volunteer service platform, Zhiyuan Hui, wants to perfect a blockchain-based application that verifies service hours given. As of now, volunteers have contributed more than 100 million hours of service while using the application that runs on the everiToken blockchain. Volunteers can record their hours with accuracy and not worry about security, plus get rewarded for the time in the form of a cryptocurrency called the Yi Coin.

A company called HullCoin similarly links community organizations with the volunteers and rewards the volunteers with a digital currency they can spend at local retailers. This is another example of a secure way to reward volunteers with help from the blockchain.

As companies would try to test the possibilities to apply blockchain technology to increase security, the benefits to nonprofits would become even more apparent.