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For many arrested people, particularly low-income citizens, bail funds are their best hope of freedom pending trial. Now, some of these funds accept cryptocurrency donations.
Facilitated by the crypto payment processor The Giving Block, the Bail Project, the Chicago Community Bond Fund, and the Nashville Community Bail Fund, for example, they accept cryptocurrencies including bitcoin (BTC), ether (ETH), and even basic attention tokens ( BAT). They have received thousands of dollars in cryptocurrency donations since the summer, according to The Giving Block, which could be a sign of increased adoption in the bail fund space.
This summer saw an increase in civilian actions against police violence in the United States, with thousands of protesters taking to the streets for the killings of George Floyd and Breonna Taylor.
Numerous protesters were arrested. Around this time, Alex Wilson, co-founder of The Giving Block, began hearing from bail funds that they were interested in using The Giving Block to process cryptocurrency payments.
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According to the director of the Community Justice Exchange, Pilar Weiss, not many of the bail funds of the organization’s members accept cryptocurrencies. He said it is based on the basic nature of many crowdfunding actions for bail funds. While a handful of their members’ funds accept cryptocurrencies, including the Richmond Bail Fund, if they do, it’s usually because they have some back-end administrative capacity to accept.
Weiss said he could see that change, however, as fundraising platforms like PayPal, for example, move into accepting cryptocurrency donations.
“The traditional type of nonprofit donor that some nonprofits rely on is on the older side, in their fifties and sixties, and often retired,” Wilson said. “Sometimes [nonprofits] having difficulty making contact with younger donors. So they see it as one of those ways to do it. It also helps them look a little more innovative when they start playing with things like cryptocurrencies and not just taking checks in the mail. “
Bail and bail funds
When someone is arrested, a judge sets bail and the detainee must pay that amount or remain in jail until trial. But not everyone has access to cash, and the system has a disproportionate impact on low-income citizens in both the short and long term.
According to research by the Bail Project, a single night in prison can have cascading effects such as the loss of a job, a home and even child custody.
Waiting in prison before trial also affects an inmate’s likelihood of going to jail, according to a regularly updated report on cash bail from the Brennan Center for Justice, a non-partisan law and political institution.
The report found that “those awaiting trial are four times more likely to be sentenced to prison than defendants released before trial. It is also likely that inmates awaiting trial will make hasty decisions to plead guilty to a lower charge in order to spend less time behind bars rather than changing a higher charge and a longer sentence during the trial. “
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Bail funds are essentially large crowdsourced funds that are then used to save people from prison while awaiting trials. Organizations like the Bail Project, the Chicago Community Bond Fund, and the Nashville Community Bail Fund are working to pay the bail for those who cannot afford it in such situations.
Co-director of the Nashville Community Community Bail Fund, Jessica Lamb, says the fund was founded in 2016 to free low-income Nashvillians from prison and work to end what the fund calls “wealth-based detention.”
“Our vision is a society where money does not determine anyone’s access to freedom,” Lamb said in an email. “Since the beginning, we have freed nearly 1,500 Nashvillians from prison. We also work with community partners to disrupt the criminal justice system and work towards reform of the money bail policy. “
Bail Funds, Civil Rights and 2020 US Elections
Bail has a cascading effect on things ranging from civil rights to elections. If people know that they are unlikely to risk arrest because they cannot afford bail, they will be less inclined to take to the streets against injustice. That threat of arrest and remaining in prison is a coercive measure that, in effect, curbs the protesters’ right to free speech and assembly.
The bail also has downstream consequences for the elections. Since not being able to afford bail affects whether they will plead guilty and how long they will be detained, it can curb people’s ability to vote. In addition to not being able to vote, if someone is held in jail and pleads guilty to something like a crime, that voting capacity can be reduced for years.
Why cryptocurrencies are important
Wilson said there are a number of benefits to bail funds that accept cryptocurrency donations.
One is that it helps them compensate for the economic loss, given the economic uncertainty of the times, by diversifying the streams of income and donations. Another aspect he noted in his work is that cryptocurrencies tend to attract a younger demographic and are likely to be entirely new donors.
See also: The Monero-for-Bail project sees growing demand during the protests
The important ability of international donors to contribute easily through cryptography is specifically something Wilson was hearing from groups that were part of The Giving Block’s Crypto for Black Lives campaign, which was launched this summer to raise money for organizations for the civil rights, including bail funds. While that wasn’t the reason The Giving Block took an interest in cryptography, it has become an important component.
The last reason is simple: taxes. When you make a capital gain (price increase) on a cryptocurrency and trade or cash it, this is a taxable event. But donations of bitcoin or other cryptocurrencies to a nonprofit are treated like donations of shares. As such, they are not considered taxable events, which means that you do not pay those capital gains taxes when you make a donation and can deduct them from your tax return.
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The financial director of the Bail project, Zach Herz-Roiphe, said he would encourage any nonprofit to launch as large a network for donors as possible. So far, bitcoin in particular and cryptocurrency in general have historically made up an extremely small portion of total donations over the years, but as crypto becomes more mainstream, this is expected to change.
“We expect more people to adopt cryptocurrencies as their preferred method of donating, especially as people understand the tax benefits of cryptocurrency giving, which are similar to those of donating conventional securities,” he said.
The impact of Crypto on social justice
Basically, The Giving Block acts as a payment processor and allows these organizations to expand the way they accept donations.
“Basically, we try to make it as easy as possible for bail funds or other nonprofits to be able to accept cryptocurrency and not have to worry about cryptocurrency volatility, for example,” Wilson said. “So all of these nonprofits have an option to automatically convert cryptocurrency into US dollars.”
Wilson said that while his organization has seen a decrease in interest from bail funds after the summer, there is still a higher level of interest than it has been. At a high level, according to Wilson, these projects have raised thousands of dollars, but less than $ 25,000 each since June in cryptocurrency donations.
See also: Activists document police misconduct using decentralized protocol
Lamb said cryptocurrency donations are a small portion of the Nashville Community Bail Fund’s total donations.
“But it’s nice to see donations come in a new way. One of the best parts for us has been learning more about the crypto community, especially the ways it has stepped up to support both the COVID-19 crisis and the black lives movement, ”Lamb said.
These aren’t the only projects that leverage cryptography to support systemic change efforts. Bail Bloc is a project that allows you to mine monero (XMR) for bail funds. A few months ago, a group of activists put together a project to document police violence on the InterPlanetary File System (IPFS) and the Ethereum blockchain.
“I think the issue of dealing with bail will continue to be popular with the crypto community,” Wilson said. “In general, I think the cause of the end of the cash bail is a cause that really resonates. In the meantime, helping people to afford bail is an alternative. “
