TaxBit, a Utah-based crypto tax automation solution startup has raised an undisclosed amount from key fintech firms PayPal Ventures and Coinbase Ventures along with several existing investors Winklevoss Capital. The crypto startup offers a crypto taxation solution in the form of automation software that can help individuals, businesses, and crypto exchanges to manage their crypto portfolios thus helping to further the adoption.
TaxBit currently operates via two of its subsidiaries namely Taxbit Enterprise to cater to the needs of large enterprises and exchanges and Taxbit Consumer to help individuals and merchants organize their calculations and reporting taxes on cryptocurrency transactions.
Austin Woodward, CEO, and Founder of TaxBit said,
“We want to thank our customers, partners, and investors for helping us move the cryptocurrency space forward. This investment will help us achieve our aim of being the most innovative and trustworthy provider of cryptocurrency tax technology.”
2021 is starting out STRONG today, we're excited to announce @TaxBit has secured investment from PayPal Ventures, Coinbase Ventures, and @winklevosscap doubled down on their previous investment. ???? ???? Read more: https://t.co/wctYe5mUCa#bitcoin #cryptocurrency #cryptotaxes pic.twitter.com/KB1wmVSvOX
— TaxBit (@TaxBit) January 7, 2021
The firm has not disclosed the capital raised during the recent fundraise however they notified that the funds would be utilized towards expanding the team and infrastructure of the firm. The firm declined to share any funding details.
Crypto Tax Services will Peak as Regularity Concerns Rise
The interest of payment giants such as PayPal which itself ventured into the crypto world very recently could prove to be a great booster for the startup. On the other hand, TaxBit would also help PayPal a great deal in automating crypto taxation for millions of consumers on its platform.
The rise of cryptocurrency as an alternative investment market with over $1 trillion market cap has also created a parallel service industry that ranges from crypto staking, crypto custody, and now crypto taxation. The demand for such services would only grow as more number of countries starts bringing in regulations around digital assets and many already have including South Korea which imposed a 20% tax on crypto while in the US, the banking regulator OCC noded for the use of stable coins and blockchain by federal banks.