With more governments recognizing cryptocurrency as a legitimate payment vehicle, there has been a steady increase in businesses using cryptocurrency and investing in digital assets. Recent studies have shown that more than a third (36%) of SMEs in the USA accept at least one cryptocurrency.
The World Economic Forum has predicted that 10% of global GDP will be stored on blockchain-related technology by 2025. Not only will the way we do business be transformed but also the way transactions are recorded and communicated.
As cryptocurrency and blockchain technology acceptance increases, the need for streamlined crypto tax reporting is on the rise. This growing market presents exciting opportunities for accounting businesses to expand their services to the digital and decentralized finance world.
Since the blockchain is a verified and immutable ledger of transactional information, any business that deals with accounts or taxes should be able to see its benefits. The automated process of transactions and transference of assets means less room for error, technical or human, and less chance of fraud. With more trust, there is less “bad data”.
Integrating blockchain technology with accounting systems reduces the time spent on mundane tasks such as bookkeeping and reconciliations. Accountants can instead focus their time and energy on data interpretation and providing better assistance to their client’s decision-making.
That said, integrating cryptocurrency and crypto market data into traditional tax services or accounting systems has posed challenges.
In the fiat world, bank statements are the main source of reference for tracking a business’ accounts. Regular accounting platforms have “bank feeds” to import all the necessary details of bank, credit card, and other transactions.
But unlike traditional currency, there are no bank accounts to track cryptocurrency trades or transactions. Financial APIs used to get information from fiat and stock exchanges also aren’t compatible with the blockchain.
Communication with the blockchain is only achieved through the use of nodes. Nodes are like servers which work to maintain the integrity of the ledger, verify transactions, and store it. Blockchain nodes are complicated beasts, requiring a considerable amount of time and money, and technical expertise to set up, run and maintain.
Read more: Blockchain Nodes Explained
Accounting services need an efficient way to pull the necessary data from users’ crypto addresses without any risk to the digital assets and get access to accurate up to date crypto trading and exchange information.
That’s where Crypto APIs come in.
Crypto APIs make creating and delivering crypto tax and accounting solutions much easier. We provide crypto tax and accounting businesses with a quick and easy way to accurately track cryptocurrency investments performance, transactions, and crypto taxes.
Some of the world’s leading blockchain powered accounting and payment companies are already implementing our solutions to provide their customers with greater account visibility and simplify back-office operations.
Here’s how Crypto APIs products help them achieve it:
One of the most important things for any business dealing with crypto taxes and accounting is to be able to see all outgoing and incoming transactions from a wallet. They also need to be able to see details as both crypto and FIAT. The easiest way to get this information is by using Crypto APIs Blockchain Data.
With the unified endpoints you can obtain all address details such as confirmed balance, total amount of coins received and spent, and the specific cryptocurrency.
With the Get Transaction Details by Transaction ID endpoint, you can receive information about transactions made across all Crypto APIs supported blockchains. These details include the total amount, the fee, and the UTXO, enabling a full tax report and simplifying accounting and back-office operations.
Blockchain Data also gives you the ability to list confirmed transactions and tokens, and internal transactions by address and time range, giving you the opportunity to filter the results by a specified time period.
It doesn’t matter if you want visibility for a single address or for an entire HD omnibus wallet. If your customers are using Ledger or Exodus HD wallets you can easily reconcile them with Crypto APIs.
With just an extended public key, you can get incoming/outgoing funds in crypto assets and in dollars. The Get HD Wallet (xPub, yPub, zPub) Details gives access to the most important HD wallet data without spending time on endless calculations or affecting fund security.
Read More: Everything You Need to Know About HD Wallets
Working on the principle of the webhook, Blockchain Events give greater visibility of digital accounts. Businesses can set up callback notifications for events such as deposits or withdrawals for addresses. The delay between the event time and receiving the notification is less than 100ms.
Event types include new transactions, new token transfer, new internal transactions, and more. Not only do callback notifications save considerable time, but they also remove the need to host or maintain any blockchain nodes which is a huge cost saving.
For accurate tax reporting companies need access to both live and historical exchange rates. Our unified Market Data uses flexible REST APIs to collect data from the top crypto exchanges using their public WebSockets. This means accounting businesses wanting to enter the crypto world can do so without any special development or additional infrastructure.
With Crypto Market Data endpoints, you can list details of cryptocurrencies or FIAT assets such as the latest rate and the rate fluctuation of different periods of time, for example over 24 hours, a week, or one hour.
Whether you are creating a dedicated crypto tax and accounting solution, or you would just like to extend your services to the growing crypto market, Crypto APIs can help. With the growing number of cryptocurrency brokerage, transfer and custody companies and the wider general adoption of cryptocurrency, the market is only going to expand.
Implementing blockchain technology now will future-proof your business and let you stay competitive in a rapidly growing market, while maintaining high-quality service to your current customers and clients.
Crypto APIs is a blockchain infrastructure suite with the mission to simplify integrating business systems into Web 3, and ease the development of new ones.
By providing blockchain- and crypto-related products, including a quantum-safe MPC-based Wallet as a Service, Blockchain Data, Automations, Webhooks, and Market Data, we help businesses significantly reduce development and infrastructure costs.
With powerful developer tools, enhanced APIs, and a one-time integration the processes of data retrieval, reconciliation of accounts and analysis are made seamless and simple.
Learn more about how you can stand out in the market and future-proof your tax and accountancy business, contact Crypto APIs today.