Maintaining cryptocurrency tax compliance can be difficult, especially since many laws are new (or unwritten). That's why Binocs was founded. Users integrate their exchanges and wallets, and Binoc provides tax reporting and other accounting details. The startup announced today that it has raised $4 million to expand into markets including the US, UK and Australia. The round was led by BEENEXT and Arkam, with participation from Accel, Saison Capital, Premji Invest, Blume and Better Capital.
Binocs was founded in May 2022 by Tanmoy Shingal and Pankaj Garg and is based in Bangalore. Binocs currently has over 1,000 users, including retail and institutional investors who need to perform forensic accounting and risk management. Binocs is currently tax compliant in the US, UK, Australia, South Africa and India, with plans to add more markets in the coming months. A portion of the funds will be used for Binox's product development and marketing team to retail and institutional investors.
Binocs can generate tax reports in less than 30 minutes. It tracks investment performance, gains and losses and capital trades as well as taxes on derivatives, credits and loans in CeFi and DeFi. The application can provide details of fees and taxes withheld by source and paid by users for transactions so that they understand how much tax they have to pay.
Binoks is founded by Tanmoy Shingal and Pankaj Garg
Shingal told TechCrunch that Binocs is intended to be a bridge to connect transactions on the blockchain with a "Web2-equivalent global consensus," especially as the number of coins, exchanges, trade types and DeFi protocols grow.
There are currently around 300 million cryptocurrency users and it is expected to reach around 1 billion by the end of this year.
The Binox founder pointed to statistics from Coin Market Cap, which showed that the total market capitalization of the crypto industry grew from around $325 billion in September 2020 to $1 trillion in September 2022. With a combined tax of about 20%, the total revenue liability is about $70 billion, an amount that could rise to $300 billion by 2026.
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Shingle, the startup's CEO, says that crypto hedges and mutual funds are often run with a small number of employees, and the tax and compliance calculation process is time-consuming because it collects data from multiple sources, aggregates it, and then you meet different compliance and reporting requirements for each type of transaction. will be
“The traditional approach is to manually collect and interpret blockchain exchange ledgers. This requires a lot of time, advanced knowledge of crypto transactions and local regulations,” Shingle said.
He added that regulation is one of the biggest barriers to further cryptocurrency adoption, with around 15 to 20 countries currently taxing cryptocurrency investments and 60 to 70 set to do so in the future.
Binocs plans to build more apps on top of its algorithm as it gets more data. "We see ourselves as a data company that understands what's happening in crypto transactions and creates applications for many future use cases," Shingal said.
Binocs is currently pre-funded and will monetize through a freemium model as well as a business plan for commercial investors.