The BitcoinTaxes Podcast
Overcoming Challenges in Crypto Accounting
Guest: Alon Muroch, CEO of Blox.io
The crypto tax space presents a unique set of hurdles for tax professionals to overcome. We spoke with Alon Muroch, CEO of Blox, to identify these challenges. Alon and his team at Blox conducted one of the first surveys of crypto-focused CPAs, providing valuable insight into these unique challenges. Alon shares his findings and discusses solutions that professionals in this space can utilize.
Alon Muroch Episode Highlights
The Difficulty in Crypto Accounting (02:00):
I think mostly it’s a very new technology. With new technologies, you have a lot of edge cases. You have a lot of complexity – and that complexity takes a while to sink in and for people to really create best practices around it.
You have a lot tools in the traditional [accounting] world – companies as big as Intuit, QuickBooks and so on. They’ll have years to develop their solutions. In the crypto space, we didn’t have the time for maturing those tools. And because the underlying technology is so different than a traditional system, you have to reinvent those tools.
The Mainstream is Catching Up (04:55):
Look at social networks, which have been around for more than 15 years. Anyone who’s above, let’s say 60 years old, doesn’t really understand why young people need to have all of their life displayed online for everyone to see. For a 14 year old it’s completely normal. It’s not doing that that is the abnormal thing. The real target audience for [crypto] is not really me and you – it is really the person who is maybe 14 or 13 years old now. Because when they are 18 and go and open their first bank account, they will, for the first time in modern history, have an actual alternative for the traditional money system.
That’s a big concept to grasp. I think that it takes a while for such big ideas to sink in. In probably 10 years, it will look absolutely normal to have a normal bank account and a crypto wallet holding some assets. For us it looks very avant garde and very new. But for them it will be just part of life. It just takes time to sink in because it’s really a monumental change. And you know, those things take time.
Understanding the Nuances of Cryptocurrency (11:45):
The first thing is to read as much as you can and understand the nuances. Adopt technology as fast as you can and avoid manual work. Then you have all the proof in the world to go to the IRS..and say…”it’s a trustable software, others are using it”. Instead of doing everything manually, which almost all the time guarantees you’ll have mistakes.
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