Crypto Accounting Software
What is Crypto Accounting Software?
Crypto accounting software automates the accounting for organizations and individuals that trade cryptocurrency, use cryptocurrency to make payments, or accept cryptocurrency for their receivables. This software captures transactions in real-time from crypto exchanges and crypto wallets and offers a consolidated view of account balances and crypto financials. Importantly it provides automatic spot price calculations of the exchange rate between the cryptocurrency and the fiat currency at the time the transaction occurred.
Crypto accounting software provides intelligent transaction classification based on the crypto data source’s labeling and categorization standards such as exchanges, trades, and withdrawals. It differentiates asset classes and simplifies crypto wallet accounting where transactions can have multiple outputs and for smart contracts accounting that can have multiple inputs and outputs. It identifies transactions occurring when exchange purchases are moved to wallets you own, ensuring those transfers are not subject to taxation.
Crypto accounting software supports multiple accounting methods including FIFO, LIFO, AVCO, and ACB.
Depending on the product and features provided, crypto accounting software supports enterprise-level organizations and crypto businesses, CPAs and accounting firms, individuals and small businesses, crypto miners, investors, traders, and portfolio managers.
Crypto Accounting Software Features
Crypto accounting software will include many of these features.
- Using APIs it integrates and syncs with multiple cryptocurrency exchanges and crypto wallets to capture transactions in real-time
- Support multiple blockchain DiFi (distributed financial) protocols, coin types, and fiat currencies
- Intelligent transaction classification and tracking of standard trades and wallet transactions, payments and donations, fees, margin trading, DeFi lending and borrowing, cap gain, mining and staking profits, airdrops, and forks.
- Automated spot price calculations, cost basis reporting
- Consolidated real-time visual reporting of crypto activity, in crypto or fiat currencies including trades, payments, receivables, current assets, capital gains, and losses, profit and loss data, realized and unrealized profits
- Portfolio analytics and performance broke down by coin types
- Crypto transaction and balance history
- Tax harvesting tools
- Silvergate crypto bank connectivity
- CSV transaction importing
- Maps wallet addresses to contacts
- Secure cloud storage, encryption, and permissions
- Connectivity and integration with traditional accounting software
- IOS/Android mobility
Crypto Accounting Software Comparison
Add-ons vs Integrations with Popular Accounting Software: If you are already using accounting software such as QuickBooks Online or Xero, they will support crypto accounting using their foreign currency features with the purchase of add-on crypto accounting software. This approach is usually less costly than buying stand-alone crypto accounting software, however, it will not provide all the features and convenient exchange and wallet integrations that dedicated crypto accounting products offer. This approach will involve more manual intervention such as inputting exchange rates or using CSV import. This is more suitable for individuals or small to mid-size businesses. For large-scale crypto operations, specialized crypto account software products that connect/integrate with more traditional accounting systems will provide the most comprehensive solution.
APIs: Using products with APIs that support integrations with a wide range of crypto wallets and exchanges for transaction data will make for more efficient, accurate, and less error-prone accounting than using CSV transaction importing.
Jurisdiction: Confirm that the accounting and reporting formats will provide the information that is required to comply with regulations governing tax filings for your jurisdiction.
Bandwidth and Processing Capability: For high volume crypto operations investigate the bandwidth and processing capabilities that the accounting software supports as there can be significant variations in scalability amongst crypto accounting platforms.
Crypto Tax Software: Crypto accounting software overlaps with crypto tax software. Crypto tax software includes crypto accounting features. Evaluate whether crypto tax software products can address your accounting needs as well.
Introductory pricing starts at less than $100 a month and ranges to over $750 a month depending on the product’s features, number of transactions, users, wallets, and exchanges supported. Transaction volume is the main driver for crypto accounting software fees. Vendor quotes are usually required for high-volume crypto operations. Free plans with limited features and capacity are available as are free trials.