When Traditional Finance Fails to Reach People in Crisis, Bitcoin Steps In

From trusted intermediaries to direct control: Bitcoin is reshaping humanitarian financing in times of crisis.

Written by: Forbes

Compiled by: AididiaoJP, Foresight News

In Gaza, a crowdfunding campaign that was supposed to bring hope has fallen into difficulty due to the limitations of traditional finance.

Sami Jamal Al-Shannat raised over £55,000 (approximately 500,000 RMB) through GoFundMe for his family trapped in war, thinking the hardest part was over. However, after the platform deducted a 3.9% fee, it did not support direct payments to Gaza. The remaining funds had to be transferred to a designated beneficiary living in a supporting country, who would then pass it on to his family.

This arrangement complied with the platform's regulations but placed the final delivery entirely in the hands of personal trust. Sami stated that the arrangement with his brother-in-law, who was the beneficiary, later fell apart, and he has yet to receive the full amount, with the dispute still unresolved. He described this not just as a financial loss but as putting his wife and children in an extremely vulnerable position.

"Raising money is not the problem," Sami told me from a displaced persons camp in Gaza. "The problem is that we have to rely on others to collect it."

Sami's current hope is to recover the funds and hold those responsible accountable, but he finds it difficult to find a lawyer in Gaza and lacks the necessary funds and connections. He also plans to continue fundraising for his family, as wartime inflation has driven up prices for basic necessities like food.

GoFundMe has not responded to multiple requests for comment.

Compliance Pitfalls

Sami's experience exposes a common issue faced by humanitarian crowdfunding platforms: they must comply with banking rules, sanctions regimes, and anti-money laundering requirements, which strictly limit the regions to which funds can be sent.

When people in crisis cannot receive funds directly, they must go through intermediaries, which not only shifts the responsibility onto individuals but can also prevent the aid originally raised for them from reaching its destination.

This compliance bottleneck can even paralyze global human rights organizations. Lyudmyla Kozlovska, president of the Open Dialogue Foundation, recalled that in the early days of Russia's invasion of Ukraine in 2022, platforms like PayPal, GoFundMe, and Wise blocked their fundraising appeals for Ukraine. However, by using Bitcoin, the foundation was able to bypass traditional delays and deliver emergency humanitarian aid the day after the war began.

Charities, aid organizations, and tech companies have been working for years to find ways to reach populations that cannot access traditional financial systems. An increasing number of developers believe that the current model relies too heavily on intermediaries, especially when funds need to cross borders or reach jurisdictions with restrictions.

Rebuilding Trust Structures

Michele Morucci, co-founder of the Bitcoin crowdfunding platform Geyser, points out that trust is the core issue.

"People think the biggest challenge is moving funds, but it’s not. The biggest challenge is deciding whom to trust."

Donors often do not know the beneficiaries; they rely on platforms, charities, journalists, and community leaders to assess the authenticity of projects. Removing an intermediary only makes sense when there is an equally credible alternative.

Geyser conducts reviews before projects go live, requiring creators to provide proof of work, team information, and necessary documents. Projects that do not meet credibility standards are not approved.

Additionally, over 100 Geyser Field Partners are responsible for identifying and supporting projects within their familiar communities, forming a trust chain between local communities and global donors. Michele stated that these partners have helped deliver 12 million satoshis (approximately £5,600, equivalent to 0.12 Bitcoin) directly to community projects. He also acknowledged that this model is still new and data is limited.

More Than Just a Fundraising Case

The weaknesses exposed by Sami's case are not isolated. Crowdfunding platforms can raise funds for families facing war, disaster, or oppression in just a few hours, but safely delivering those funds to the intended beneficiaries is much more complex.

GoFundMe is not the only platform that restricts payment regions. Mainstream crowdfunding platforms rely on banks and payment providers and must comply with sanctions, identity verification, and anti-money laundering rules in specific jurisdictions.

When direct payments are not supported, organizers may need to designate a beneficiary in another jurisdiction to collect the funds. While this satisfies the platform's legal and banking requirements, it shifts the responsibility to the collector. Once the relationship breaks down, the options for beneficiaries to seek accountability through the platform are very limited.

Shifting Trust to Validators

The Agora platform has taken a different approach. It allows funds to flow directly between donors and beneficiaries, with validation coming from organizations and individuals who have firsthand knowledge of the projects.

Mary Kate, co-founder of Soapbox (the team behind Agora), explained that donors may not know the applicants but may know and trust the organization validating the project.

"This shifts our trust from the project itself to the validators. You may not know the applicant, but you may know and trust the organization validating it."

This model leaves the final decision-making power with the donors. Even without validator support, projects remain visible; trusted organizations can add context and credibility without becoming the sole gatekeepers.

Agora also removes the crowdfunding platform from the payment process. Donations are sent directly to the wallets controlled by the beneficiaries, reducing the risk of funds being held by the platform or passed through others.

Bitcoin allows funds to flow across borders without the need for platform custody or beneficiary transfer. Of course, risks related to wallet security, access, and exchange rates still exist.

For Mary Kate, this control goes far beyond the movement of funds themselves.

"We cannot take your account, we cannot shut down your project, we cannot take your money," she said. "For those experiencing trauma and a lack of control over their lives, this can be a huge moment of empowerment."

Direct payments do not solve all problems. Projects still need to be vetted, donors still need enough information to make informed decisions, and beneficiaries may still misuse funds. Agora is working to make these risks more transparent while giving beneficiaries greater control over the funds raised in their name.

Unexpected Consequences of Financial Sanctions

Sami's experience is not an isolated case, as the fundamental issues are widespread. Activists, journalists, and humanitarian organizations around the world have found that as financial regulations become increasingly complex and sanctions affect entire jurisdictions rather than just governments, it has become more difficult to legally transfer funds across borders.

Femi Longe, global freedom technology strategy lead at the Human Rights Foundation, believes these restrictions often cause unintended harm to those who should receive humanitarian funding.

"Traditional crowdfunding platforms are regulated, and cross-border fund transfers must comply with anti-money laundering and sanctions regulations. The problem is that these rules often end up impacting legitimate opposition groups, nonprofits, and ordinary people rather than the governments they are aimed at."

Femi noted that even organizations operating legally in sanctioned countries find it difficult to receive donations. Visible financial connections may expose domestic supporters or relatives to retaliation.

Lyudmyla warned that this issue has gone beyond administrative friction and evolved into "transnational financial repression"—where regimes use global anti-money laundering/anti-terror financing rules to deprive dissenters of access to banking, even in Western countries.

She cited a landmark resolution passed by the OSCE Parliamentary Assembly in July 2026, which recognized transnational financial repression as a systemic threat and called for enhanced protections for donor privacy and privacy-preserving digital tools. Lyudmyla stated that Bitcoin payment tools are becoming a necessary lifeline for targeted donors and activists.

Political opposition, independent journalists, and civil society organizations often rely on international donations to sustain their operations. When donations become difficult to send or are more easily monitored, financial infrastructure becomes another form of pressure.

This does not mean that regulation should be eliminated. Public fundraising requires accountability, transparency, and safeguards to protect donors from fraud. Interviewees all acknowledged this challenge and accepted the reality that there is no perfect solution.

Femi believes the goal should be to remove unnecessary intermediaries while retaining accountability.

"If we allow project operators to directly control the wallets receiving funds, I think that would be better than the current situation," he added, noting that validation and oversight remain essential components of any system handling public donations.

Sami's case highlights the fundamental weaknesses of the humanitarian financial architecture. Systems built around banks, payment processors, and judicial boundaries often struggle to transfer funds to people in war, political repression, or humanitarian crises. No one believes that technology alone can solve the humanitarian fundraising problem.

Direct payments to beneficiaries reduce one layer of risk but do not guarantee that projects are genuine, organizers are honest, or donations are ultimately used for their stated purposes.

Femi said, "I don’t think Bitcoin can solve everything. There still needs to be a system to verify project creators, and accountability for how funds are used. These challenges will not disappear just because payments become direct."

Michele and Mary Kate's platforms are also working along similar lines: they do not claim to eliminate trust but rather attempt to redesign where trust resides.

The new generation of humanitarian crowdfunding is not just a temporary patch on a broken traditional model but a systemic shift. Open payment networks allow beneficiaries to directly control the funds raised in their name, while decentralized trust networks help donors decide whom to support.

While judgment, validation, and accountability remain indispensable, this open architecture is circumventing the legacy financial restrictions and regulatory barriers that hinder traditional platforms from reaching those most in need.