If you are crypto enthusiasts, investor, blockchain lover, crypto accountant, tax professional, crypto company, post-ICO business and even mining operations – you need to continue reading on.
Crypto companies and blockchain businesses alike are beginning to worry about the pending IRS updates to legal and accounting guidance for crypto assets. The current ambiguity and future uncertainty has left a big question mark over the future of crypto in the eyes of governments and financial institutions.
Looming regulation has illuminated a growing industry need for crypto accounting and tax preparation solutions for businesses, high networth investors, crypto companies, and a variety of professionals. Traditional companies enjoy the power and simplicity of general ledger software such as Quickbooks or Xero to handle back office accounting, or bookkeeping. The crypto company of today are still looking for the best possible solutions to tackle the unique challenges of crypto accounting and tax prep for CPAs, bookkeepers and tax professionals.
As the leading platform for crypto asset accounting, bookkeeping and management Blox is dedicated to discovering the most difficult industry challenges and solving them with powerful tools and features that streamline and improve the crypto accounting and tax prep needs of any crypto company.
A Versatile Transaction Table
Crypto companies, such as a cryptocurrency exchange, will facilitate thousands of transactions a day. Some are purchases, sells, trades and more, but each make for a transaction (and each transaction becomes a taxable event). When preparing your cryptocurrency taxes or needing to account for all your yearly crypto transactions, locating them is not straightforward. Every Tx will be associated to a long-string, alpha-numeric wallet address that can be difficult to identify without proper software.
The Blox platform solves this need with a solution that offers a more intuitive way to view your complete and up-to-date transaction history across your entire portfolio. You can now search transactions, add supporting notes, documents or attachments for a smarter way to effectively track, label and manage your assets with more control than ever before.
It is simply not enough for professionals to view a list of transactions – they need far more details. The Blox Transaction table provides a detailed overview all your complete transaction history. With a chart of account logic, you get three layers of classifications to filter your transactions. Bookkeepers even have the ability to view corresponding or related transactions, with a stunning user interface to distinguish between transaction events.
The Transaction Table from Blox gives unparalleled control to anyone sitting behind the Blox platform.
But, Blox has gone even further then more will expect.
Because crypto transactions can easily lead to taxable events, it is important for businesses to be able to distinguish a true transaction with profit/loss, versus an internal transaction which is simply the movement of funds within the organization.
When creating transactions between your personal portfolios, Blox will recognize each transaction as an internal transfer. Instead of appearing as a generic transaction that could be classified as a withdrawal, users can now view which transactions were executed internally. Because transactions can trigger a taxable event, by identifying internal transfers, there will be a more accurate result when calculating cost basis, and other calculations.
A Handy Address Book
Businesses that operate or transact using cryptocurrencies will often send or receive crypto from a variety of addresses. Sometimes those addresses are one-offs for a specific reason, but for most businesses, they are transact with the same address many times.
To remove confusion of deciphering the ownership of complex crypto addresses, Blox has built an organized address book that aggregates all the frequently used crypto addresses. You can label each address by company or department to help identify when searching for a transaction or a business.
(Above: How to edit your address title)
(Above: How to name your new address)
When it comes to handling bitcoin wallet addresses, they occasionally have added security forcing the creation of multiple addresses. This can create some confusion when making calculations, organizing assets or when handling accounts payable/receivable.
For accounts or transactions with multiple BTC addresses, Blox can now detect multi-addresses and display them for users within the transaction table. Cases where there are multiple addresses as an added security measure, Blox can now group multiple BTC addresses into one labelled name as a clear identifier that can be added to the Address Book. This makes life easier for professionals by grouping large volumes of Bitcoin addresses.
Calculate Crypto Cost Basis *COMING SOON*
One of the most important needs for the crypto accounting and tax world is calculating your personal or businesses, profit and loss. Calculating P&L within crypto is still a grey area, as missing legal guidance and best practices have left it open to interpretation. Most professionals will rely on the FIFO (first in, first out) cost basis method for calculating profits or losses. But in crypto, these calculations require precision accuracy and complete user data.
One of the biggest challenges for crypto CPAs is missing data, and when they attempt to calculate the cost basis, the results are are all wrong.
Cost basis from Blox introduces a Gains & Loss calculation tool, capable of analyzing account transactions for reconciliation, accounting and tax prep with a full result report for users. With this tool, users can more easily and intelligently calculate their capital gains for their digital assets based on original purchase price.
This feature has been released for a select few clients to trial the new service feature from Blox. In the coming months, the feature will be refined and released for use on the Blox web or mobile application.
Stay Classy With Classifications
Our platform offers the ability to label and classify transactions to improve the organization and allocation of assets, with options for multiple portfolios and accounts. Custom design transaction classifications to match your Chart of Accounts, with our new Tx Table. Finance teams now have a more organized approach for faster search and discovery of all your crypto transactions.
On the Blox platform, bookkeepers responsible for tracking and managing a company’s assets can simply label and classify transactions then categorize them accordingly, saving hours every day on tracking assets and transactions. A perfect feature when preparing for an audit or taxes.
The same bookkeepers can also organize taxable transactions on a quarterly basis or certain timeframes by using custom filtering options. Additional features such as bulk classifications, can allow bookkeepers to classify large batches of transactions all at once.
It’s important for professionals to be empowered with the best tools to save them time and still produce great results.
(Above: Image of classification feature)
(Above: Image of sub-classification feature)
Import or Export Your Transactions & Balances
Businesses today may work with multiple softwares to handle business operations, and many require Quickbooks and other general ledger software when handling internal finance operations. While many companies use software like Quickbooks for example, they still need to have include transactions and assets from the crypto-side of the business. Integrating crypto and traditional finances is not always kosher and requires careful formatting and conditioning.
Manual data entry into a general ledger is not only time consuming, it can also prove to lead to volatile results due to human errors. Using the Blox platform, you and professionals alike can simply export your daily snapshot of your balance, your transaction history and more. While it may require human intervention to complete the process accurately, in the near future, the entire import/export process will be completed with the click of one button.
To help new users and professionals get acquainted with this feature, we went ahead and produced an informative guide on How To Export .CSV Files From Blox.
The future of cryptocurrencies is heavily reliant on the legal framework executed by governments and institutions like the IRS. While the path to the future is unknown, most CPAs and industry experts believe that imperative to be prudent, proactive and staying up to date on the latest news and trends for crypto accounting or tax prep. To truly be effective, it requires access to smart software with even smarter tools.