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How Coinbase’s $1 billion crypto philanthropy ambitions left a trail of disappointment and workers in the lurch

September 20, 2022, 2:03 PM UTC
Stylized portrait of Brian Armstrong
Coinbase Founder, Brian Armstrong
Photo Illustration by Fortune; Original photos by Getty Images

Christian Maloba needed a job. It was February 2021, and he was a 30-year-old student in the Democratic Republic of the Congo. Maloba was taking online classes at BYU Idaho and had some time to spare, so he created a profile on the freelance platform Upwork, offering translation services. He wasn’t having much luck until a strange message popped into his inbox from someone named Joe Waltman. 

“The nature of the project is likely quite different from what you normally do on Upwork,” Waltman’s message read. “But, if it appeals to you, it could be very rewarding and may allow you to help people in your community.” 

Waltman led an organization called GiveCrypto. He explained the outfit was looking for “ambassadors,” and he’d reached out because Maloba lived in a country that scored low on the economic freedom index—a ranking put together by the Heritage Foundation, a conservative think tank.

Maloba’s job would be to find people in need who lived near enough he could visit them regularly. He would have to set them up with crypto wallets and figure out a way for them to convert donations in the cryptocurrency Ether to the Congolese franc. After each recipient received around $100 from GiveCrypto, Maloba would have to document how they spent the money. GiveCrypto would pay him $30.

“I definitely thought it was a scam,” Maloba later told Fortune. Regardless, he needed work and had been interested in crypto for a few years, so he agreed to the terms. He was an ambassador for GiveCrypto.  

What Maloba did not know was that he was joining an organization tied to Coinbase, one of the biggest crypto companies in the world. Coinbase created GiveCrypto in June 2018 and introduced it with great fanfare. Founder Brian Armstrong published a lengthy blog post where he argued that for cryptocurrency to gain mainstream adoption, it needed to be distributed directly to those in need. GiveCrypto would function as a direct giving organization, distributing cryptocurrency across the world through local “ambassadors.” 

Christian Maloba, an “ambassador” for GiveCrypto from the Democratic Republic of the Congo.
Courtesy of Christian Maloba

“If there is enough density in certain regions, we may be able to spark local crypto economies,” Armstong wrote. 

Armstrong had raised $3.5 million for the project, including $1 million of his own money. He proclaimed the goal was to grow GiveCrypto’s total pot to $1 billion in just two years. A few months later, Armstrong wrote in a separate post that GiveCrypto had hired Joe Waltman, a serial entrepreneur, as its first executive director.

“GiveCrypto was started with the goal of financially empowering those in need around the world through crypto,” a Coinbase spokesperson told Fortune.

Coinbase would be joining a storied, albeit incipient, lineage of crypto philanthropy, such as the Pineapple Fund, which had launched in 2017 to give away tens of millions of dollars’ worth of Bitcoin to nonprofits. Despite Armstrong’s lofty promises, GiveCrypto would come to represent the dark side of crypto-based charity—a mess of illogical coordination, misplaced assurances, and unpaid labor.  

“It connects all of the worst bits of the sharing economy and the gig economy to the worst parts of cryptocurrency,” said Peter Howson, an assistant professor of international development at Northumbria University. “And then obviously the outcome is horrific.”

A question of adoption

Maloba had a front-row seat to crypto philanthropy gone wrong.

After setting up a Coinbase wallet at Waltman’s instruction, Maloba figured out a way to transfer ETH into the Congolese franc through a local exchange agent who would charge a small exchange fee. He found three people in his community that he thought would benefit from the money and helped them get set up with wallets.  

“For a regular person, it was so complicated,” Maloba said. He had heard about other NGOs that operated in the area, distributing money in fiat currency, and he remembered thinking that would be much simpler. Even so, he understood that crypto education was part of the mission, so he was happy to act out his title of “ambassador.” 

“We even planned to have classes where people would come together and I would tell them what crypto is and how to use it,” he told Fortune.  

According to Howson, using philanthropy as a means of disseminating crypto’s mission—and onboarding new users—has been a dynamic since the first days of the technology. Back when Bitcoin was restricted to niche online communities and Internet Relay Chat discussions, an early heated debate centered around whether Bitcoin should be used as a funding tool for the embattled Wikileaks as a vector for spreading the cryptocurrency’s libertarian and cyberpunk ideology.  

One of the last posts from Bitcoin’s pseudonymous creator, Satoshi Nakamato, was an impassioned plea in late 2010 for Wikileaks to not try and use Bitcoin. “The heat you would bring would likely destroy us at this stage,” they wrote. 

Wikileaks would still establish a Bitcoin payments channel a few months later, with Julian Assange later citing the cryptocurrency as crucial for the site’s continued existence.  

In reality, Bitcoin and Wikileaks needed each other, Howson said. “Bitcoin couldn’t have ascended in popularity without Wikileaks,” he told Fortune. “It made Bitcoin legitimate.” 

In the ensuing years, crypto philanthropy projects would pop up during boom cycles. The most famous example was the Pineapple Fund, set up in 2017 by an anonymous individual who pledged to give away over 5,000 Bitcoins—at the time worth over $85 million—to charities focused on everything from psychedelic therapy to environmental conservation. The fund’s creator claimed to have donated all of the Bitcoins in a Reddit post in May 2018.

“Bitcoin couldn’t have ascended in popularity without Wikileaks. It made Bitcoin legitimate.” 

Peter Howson, assistant professor of international development at Northumbria University

Alex Wilson, the co-founder of a company called The Giving Block that helps charities accept donations in cryptocurrencies, was inspired by the Pineapple Fund to create his own endeavor.  

“We think crypto philanthropy is good for crypto adoption,” he said. “It creates this virtuous cycle of great press and getting people interested in crypto, which creates more crypto donors.” 

Howson took a decidedly more cynical view, especially as major exchanges like Coinbase and Binance launched their own philanthropy initiatives.  

“They’re just paying for lots of advertising space and saying, ‘Look at all the good we’re doing,’” Howson said. “Really, all they’re doing is trying to increase adoption and recruit new suckers.”

Where’s the money?

Just a couple of weeks after Waltman first contacted him, Maloba wrote back to say the process was complete—the money had been distributed, and Maloba requested his $30 payment through Upwork.  

Waltman asked Maloba to collect photos and videos of the people using the money, which Maloba recorded. One recipient was able to pay rent on his house for four months. Another used GiveCrypto’s donation for academic fees and food, and the third to pay medical bills for his sick child. 

GiveCrypto instructed ambassadors like Maloba to send over photos and videos of the recipients using the cryptocurrency funds they received, posting the content to the GiveCrypto website, as seen here.
Screenshot from GiveCrypto.org

“I felt like an angel coming to the rescue,” Maloba said.  

The next month, March 2021, Waltman told Maloba that because of his great work, Maloba would be allowed to invite 10 more people from his community to receive crypto payments.  

“Unfortunately, we can’t pay you more for this, but you will be able to help people in your community,” Waltman wrote. 

Maloba was conflicted. He’d initially gotten the job through Upwork after all, but he saw the positive impact of the transfers, despite the amount of work on his end.  

“All is well since it’s going to help people in need in my country,” Maloba responded on Upwork. “I’m still positive and hoping that I will also get something in return maybe later, hopefully.” 

“There definitely may be opportunity down the road,” Waltman replied. “Thanks for being open-minded.” 

From conversations with five other global ambassadors, Fortune learned that GiveCrypto not paying ambassadors—or abruptly cutting off payments without notice—was pervasive.

Alejandro Antich Zapata, a 33-year-old in Venezuela—where GiveCrypto mainly operated—started working with the organization in March 2019. This was during an earlier phase of the project, and Antich’s role had a much wider scope than Maloba’s. At his peak operation, Antich was working more than 40 hours a week to find recipients for payments, with the initiatives ultimately helping around 7,200 people. Unlike Maloba, GiveCrypto paid Antich a monthly salary in ETH—around $400 initially, which later increased to $600.  

It was Antich’s primary source of income, at least until the pandemic hit. In March 2020, GiveCrypto stopped operating in Venezuela without telling Antich.

“I didn’t receive any explanation, notification, or even a message from GiveCrypto,” he told Fortune. “It was confusing for me because I was not ‘fired,’ or informed in any way about the future of the projects.” 

Another Venezuelan ambassador, a 30-year-old named Humberto Urdaneta, said that during a particularly intensive phase of the project, in September 2019, he was working 12 hours a day without breaks due to the complexity of managing the money transfers and banking problems. He was helping around 100 Venezuelans receive $10 a week in ETH and convert it to bolívares. He did not receive a salary, but instead about 2% of each transaction—around $80 per month, minus the costs of hyperinflation.

Urdaneta told Fortune that he was working with GiveCrypto for the mission, not a salary. Even so, he had the same experience as Antich: GiveCrypto abruptly halted operations without explanation.

“Frankly, I felt sad,” Urdaneta said. “I thought the project was going to be implemented on a large scale in Venezuela.”

Logistical hurdles

The whiplash of GiveCrypto’s strategy and treatment of its ambassadors doesn’t appear to have been borne of ill intent, but it does reflect the difficulty of operating a global nonprofit.

Alex Wilson, The Giving Block’s co-founder, said he often has to tell donors that starting their own charity is not an effective path.  

“Crypto tends to try to reinvent the wheel when it doesn’t necessarily need to,” he said. “Crypto donors are better off partnering with or working with existing causes rather than trying to create their own new nonprofit.” 

By creating a global project focused on low-income countries—with a billion-dollar goal in two years, no less—GiveCrypto upped the ante.  

For one, it had to figure out cross-border payments for each country in which it operated. In Venezuela alone, GiveCrypto had to deal with a knot of increasingly complex regulations and sanctions imposed by both the U.S. and the autocratic administration of Venezuelan president Nicolás Maduro, which Antich suspects is one of the reasons it stopped operating during the pandemic.  

More than navigating regulations, GiveCrypto also had to figure out how to help recipients actually understand and use cryptocurrency for basic needs—a task it often approached through trial-and-error and foisted on the ambassadors.

In his initial announcement of GiveCrypto, Armstrong admitted that many who received crypto payments would exchange it into local currency. Still, he expressed optimism that others would hold on to the cryptocurrency and even start doing crypto-to-crypto transfers. 

Rodney Williams, the co-founder and president of the community finance startup SoLo funds, said that the complexity of cryptocurrency, especially for low-income groups, outweighs its utility. “Philanthropy is about accessibility,” he told Fortune. “Have you tried to sign up for Coinbase? There is nothing quick and fast about Coinbase.”

Plenty of organizations have found success using cryptocurrency as a tool in philanthropy, although generally for fundraising, not distribution. Alex Wilson of The Giving Block said that accepting donations in crypto allows nonprofits to open their donor pool to younger people, and that his organization has worked with over 2,000 nonprofits, raising over $100 million.  

“Philanthropy is about accessibility. Have you tried to sign up for Coinbase? There is nothing quick and fast about Coinbase.” 

Rodney Williams, the co-founder and president of the community finance startup SoLo funds

Another example is Gitcoin, a platform that facilitates crowdfunding campaigns for open-source software projects, raising almost $70 million exclusively in cryptocurrency. Its founder, Kevin Owocki, admits that Gitcoin inherently attracts a more tech-savvy crowd that understands crypto. 

“Unless you’re doing economic business in the metaverse—in the Web3 space—there’s not really a reason to have crypto,” he told Fortune. “If you’re giving crypto to places where there’s not even infrastructure where they can use it, then that just feels like an act of self-promotion to me.”

A frustrating end

Maloba was able to find 10 more recipients without much of a problem. He’d told them not to talk about the donations, but they inevitably did, and before long more people from his community were flocking to him, asking for money.  

“I was like a judge looking around and seeing who really needs help,” he said.  

In early April 2021, two months after Waltman first contacted him, Maloba wrote to Waltman on Upwork. He explained that one of the recipients was a doctor who had used the funds to buy drugs for her pharmacy. She was requesting more to buy new equipment for the health center. Waltman did not respond.  

The next month, May 2021, Waltman published a post on GiveCrypto’s Medium page. After having an informal relationship with Coinbase since its inception in 2018, GiveCrypto would be officially subsumed by the exchange, he wrote.

A separate post on Coinbase’s official blog said that GiveCrypto would be brought into Coinbase as a 501(c)(3), or a charitable tax-exempt organization. Records obtained by Fortune indicate that the “Coinbase GiveCrypto Foundation” was later incorporated as an exempt entity in Delaware on Oct. 4, 2021. There are no public records of a 990, the form that tax-exempt organizations are required to file to the Internal Revenue Service that includes accounting records.

Blog posts from both GiveCrypto and Coinbase touted the official merger as a major step forward. “We’ve long had a relationship with GiveCrypto, but by transitioning its efforts into a private foundation of Coinbase we can substantially increase funding,” the Coinbase post said. “That reach can be truly life-changing.”  

It was one of the last public mentions of GiveCrypto by either organization.  

As it turns out, when Waltman recruited Maloba to GiveCrypto in February 2021, it would be the project’s final few months, at least as an organization with public updates.  

In May 2021, after not hearing from Waltman for a couple of months, Maloba followed up with Waltman on Upwork, telling him that he had read the update that GiveCrypto would now officially be part of Coinbase.

“As an ambassador, I would be happy to help even more people,” Maloba wrote. 

In June, Waltman emailed Maloba, cc’ing several members of Coinbase’s marketing team.  

“A key initiative this year is to tell human stories of Bitcoin/crypto’s impact on society and how this technology is increasing economic freedom throughout the world,” one of the Coinbase employees wrote to Maloba. 

In the next weeks, at their behest, Maloba would produce even more videos of the recipients, editing them and adding English subtitles himself, still without payment. In a call with Maloba, the marketing people spoke about expanding the initiative, even floating the possibility of sending a documentary crew. 

They also asked Maloba to come up with project proposals beyond individual giving. Maloba put together two—one to build a hospital, another to build a school—each with a meticulous budget and timeline. Maloba even spoke with local engineers and construction workers, promising them work. He sent the proposals to the Coinbase employees, but they never responded.

In September 2021, Maloba received a separate email that GiveCrypto was launching a new version of the ambassador program. He wrote to Waltman and the marketing people asking whether he could still participate and whether they had looked at his proposals.  

“We are putting a hold on both of these initiatives while we reorganize things on our end,” Waltman responded.  

In October, Waltman wrote a post for Coinbase’s blog, saying that GiveCrypto was updating the ambassador program to focus on Venezuela, Colombia, and El Salvador, and that he was looking forward to more growth in the fourth quarter. That turned out being his final post. Waltman stepped away from GiveCrypto in late 2021. His LinkedIn profile only references being a “Group Product Manager” at Coinbase with no mention of GiveCrypto, listing March 2022 as his ending date. He declined to speak for the article.

“If anything, you’re just pulling [people] into a scam, and then you’ll abandon them. They’d rather you just left them alone.” 

Peter Howson, assistant professor of international development at Northumbria University

Without any public accounting, it is impossible to say how far short of its billion-dollar goal GiveCrypto fell. Through 2020, Waltman would include figures in his monthly Medium posts, writing in June that GiveCrypto had helped 4,217 people to the tune of $34,900. That stopped by the end of 2020. 

One ambassador in Venezuela told Fortune that GiveCrypto resumed operations after the first six months of the pandemic. He said that he continues to work with 10 recipients, helping them receive around $125 in ETH every two weeks.  

Of the ambassadors that Fortune spoke with, he is the only one still working with the organization. It is unclear what the current scope of the operation looks like. A Coinbase spokesperson told Fortune that GiveCrypto has distributed more than $1 million in aid in 2022 to more than 1,000 people, but declined to answer further questions. “Coinbase is committed to advancing economic freedom throughout the world,” they said. “Given the nascent nature of crypto, success will be measured over the course of years or decades—not months or quarters.” 

Howson, the professor of international development, said that GiveCrypto’s operation is representative of a broader pattern of crypto-based global philanthropy. He pointed to Worldcoin, the much-maligned nonprofit founded by Sam Altman where people in developing countries would receive cryptocurrency in exchange for having their irises scanned by a large, metal orb. Like GiveCrypto, Worldcoin has had to pivot its strategy on several occasions, frequently exiting countries and delaying its launch date. 

“If anything, you’re just pulling [people] into a scam, and then you’ll abandon them.” Howson said. “They’d rather you just left them alone.” 

By the end of 2021, Maloba was growing frustrated. He had worked hard to put together the proposals, and he had no idea who could even provide him with updates.

On Jan. 27, 2022, after not hearing from GiveCrypto or Coinbase for several months, Maloba tried one last time, reaching out to Waltman on Upwork.

“Is the GiveCrypto ambassador program still on going? What about the other program of building schools and hospitals we started working on?” Maloba asked.  

“I am no longer with GiveCrypto…I am not sure if they are continuing the program,” Waltman replied several hours later. “Sorry.”