arjun_s

Yes, saw this.

Q–1: How is virtual currency treated for federal tax purposes?

A–1: For federal tax purposes, virtual currency is treated as property. General tax principles applicable to property transactions apply to transactions using virtual currency.

Q–2: Is virtual currency treated as currency for purposes of determining whether a transaction results in foreign currency gain or loss under U.S. federal tax laws?

A–2: No. Under currently applicable law, virtual currency is not treated as currency that could generate foreign currency gain or loss for U.S. federal tax purposes.

Tried looking you up on Telegram but didn't find you. Is that the right username?

Yep, I meant in terms of a feature summary / validation of some demand.

fyi, are you interested in this?

I think thats a good summary.

On number 2 - I wouldn't call it "cryptocurrency" first but rather (and forgive my lack of articulation here) crypto/defi/blockchain first.

Think of crypto like the new internet protocol - rather than equating it to gold. But unlike the internet protocol, this extends much beyond e.g. crypto is wealth, an application, a service, a medium.

This means a whole new set of services and revenue streams / protocols on revenue (from selling products) and expenses (guessing these get built on a host of defi applications). All these integrations - will XERO focus today? Nope. Is the potential market for this massive - yes, well if you are bullish crypto.

Early examples of companies that would use this - https://upland.me/, https://nbatopshot.com/

This roadmap looks pretty complete - https://request.network/en/invoicing/#roadmap

Yes that is correct, thank you.

e.g. I get equity funding in my company. Now: accountant needs a contract like a share note to create a line of equity on the right hand of the balance sheet.

But in the future, the system is linked to a token sale and the shareholders are automatically updated.

Or, I am making sales of lets say NFTs on my platform, then the revenue on each transaction is automatically linked via the same NFT contracts to the revenue line. The ETH fee is directly attributed to the costs line etc.

The whole thing creates an auditable statement that can be used for data/regulatory audits/dashboards/getting crypto financing etc...

For a lot of crypto companies, the suppliers charge crypto e.g. a DeFi based product. Salaries can potentially be in crypto.

I don't think the analogy is right. If in this cow business everyone instead of transacting in dollars and milk supply contracts start using a whole new language called "ether" then your accounting platforms/accountant/electronic receipts are not made for it.

Bingo - thats a pretty good product (from the website) for the things I mentioned :)

Yeah thats what I am trying to test - if there is enough market for this. Unlikely a SAP/XERO/others will be fast enough to pivot (lol). I am assuming an ideal company is one that funds itself in crypto, makes revenue in crypto, has most expenses in crypto, debt in crypto might find it useful - at least thats my conjecture.

The problem to solve is a crypto first replacement for a SAP/XERO platform that aggregates receipts/proof of sales/bank integrations/expenses+fees for a crypto first company like a crypto game dev company or a crypto exchange etc that will have revenue, most expenses, funding, debt etc in crypto rather than fiat.

Yes, functional currency would be crypto for a crypto first company.

If we take example of a SAP or XERO like software, a conventional company uses integrations/receipts from banks, sales platforms, physical receipts etc. In a crypto first company e.g. a crypto game dev company - the sales are in crypto, the funding via tokens is via crypto, the platform fees (defi apps) is in crypto - so a SAP/XERO like software is not build for purpose - hence my question that is a crypto first accounting/expense/reporting software needed.

Volatility will still remain if you use current mechanisms depending on how you book these assets on your balance sheet. Which more depends on how the taxman classifies them going forward.

Think SAP/XERO but crypto first.