Blockpit, one of the leading companies developing financial compliance solutions for cryptocurrency assets raises $10 million during its Series A funding. Led by Luxembourgish VC MiddleGame Ventures with participation from Tioga Capital among others, Blockpit will use these funds to continue developing Cryptotax and making it available in more countries.
Photo: Blockpit CEO and co-founder Florian Wimmer / Image Credits: Blockpit
The first quarter of 2021 was a great year for cryptocurrency enthusiasts. The second quarter less so. Indeed, China’s crackdown on cryptocurrency mining and Elon Musk’s change of heart hit the crypto market rather hard.
However, Blockpit a leading expert in financial compliance solutions and tax reporting for blockchain technology-based assets is unconcerned. Indeed, the recent increase in regulations seems to have benefitted them.
Founded in 2017, Blockchain is the developer of Cryptotax, a software that that automates the calculating of taxable crypto assets such as Bitcoin and Ethereum, as well as from other activities such as income from staking, DeFi, lending, mining and margin trading.
The European Commission catches up
Although interest in cryptocurrencies has been around for a while now, regulators have been lagging behind. Early adopters have benefitted from this by easily avoiding taxes on their profits. However, having caught wind of this, the European Commission’s plans to introduce the DAC-8 directive to make sure that crypto users declare their crypto assets and get taxed on them.
“Regulation of the crypto and blockchain ecosystem has been evolving with leaps and bounds in the last few years. Based on, for instance, the DAC-8 regulation, we expect that very soon, VASPs (=virtual asset service providers) will report to the different European governments the positions of their clients,” says Patrick Van de Mosselaer, co-founder of Tioga Capital.
Blockpit has anticipated this change and now that more and more regulations are being introduced, its Cryptotax solution seems primed for a large uptick in users.
“In order to file their taxes, Blockpit – the leading European team in crypto tax software – will be there to help them. They are already helping thousands of people, and we expect that in the coming year that will grow to millions, ” adds Van de Mosselaer.
Strong investor support
Blockpit is not the only one sensing the winds of change. Indeed, MiddleGame Ventures (MGV), Fabric Ventures, Force Over Mass Capital, Tioga Capital, Avaloq Ventures and Venionaire Capital have pitched their dollars to the cause and raised $10 million.
“In addition to the monetary boost, the expertise as well as international network of the investors in various areas will result in new market access and numerous opportunities for commercial partnerships. This will massively accelerate the further development of our products as well as our expansion to new countries,” says Blockpit CEO and co-founder Florian Wimmer.
MGV was an early investor in Ripple and Fabric Ventures has stakes in Coinbase. The investors’ expertise and funds will help Blockpit further develop its Cryptotax solution and get it ready for international expansion.
“We are delighted to partner with Blockpit. We firmly believe in the future of digital assets,” comments Pascal Bouvier, Managing Partner of MiddleGame Ventures.” As these digital assets are more and more accepted by investors of all stripes and colors, retail and corporate or institutional, taxation and accounting considerations will become increasingly more important to master. Blockpit is at the nexus of these trends and has a bright future ahead of itself.”