Binocs App Mac iPhone mockup

Crypto tax reporting app Binocs helps users navigate regulations • Technology Flow

Maintaining tax compliance for cryptocurrency can be tricky, especially since many laws are new (or not yet written). That’s why Binox was founded. Users integrate their exchanges and wallets and Binocs provides tax reporting and other accounting details. The startup announced today that it has raised $4 million to expand into markets such as the United States, United Kingdom and Australia. The round was led by Beenext and Arcam with participation from Accel, Syson Capital, Premji Invest, Bloom and Better Capital.

Founded in May 2022 by Tonmoy Shingal and Pankaj Garg and based in Bangalore, Binocs currently has over 1,000 users, including retail and institutional investors who need forensic accounting and risk management. Binocs currently has tax compliance in the US, UK, Australia, South Africa and India, with plans to add more markets next month. A portion of the funding will be used for product development and Binocs’ go-to-market teams for retail and institutional investors.

Binocs can provide a tax report in less than 30 minutes. It also tracks returns on investment, gains and losses and capital conversions, as well as taxes for derivatives, borrowing and lending across CeFi and DeFi. The app can provide users with details of fees and tax deducted at source already paid on transactions so that they can understand how much taxes they have to pay.

The founders of Binax are Tonmoy Shingal and Pankaj Garg

The founders of Binax are Tonmoy Shingal and Pankaj Garg

Binocs is intended to be a bridge connecting transactions on the blockchain to a “web2 equivalent consensus world,” Shingle told Technology Flow, especially as the number of coins, exchanges, trade types and DeFi protocols grow.

There are currently around 300 million crypto users and it is expected to reach around 1 billion by the end of this year.

The total market cap of the crypto industry has grown from around $325 billion in September 2020 to $1 trillion in September 2022. With a combined tax of around 20%, the total tax liability is Binocs’ founders, citing figures from Coin Market Cap. About $70 billion, this figure will rise to $300 billion by 2026.

Shingal, the startup’s CEO, said crypto hedges and investment funds run with a small number of staff, and calculating tax and demonstrating compliance is time-consuming because they have to pull data from multiple sources, merge it and then commit. Each type of transaction has different compliance and reporting requirements.

“The traditional approach is to manually combine and interpret blockchain exchange ledgers. Doing this requires considerable time, advanced knowledge of crypto transactions, local regulations,” said Shingal. “This work is time-consuming and prone to errors, which can be expensive.”

He added that 15 to 20 countries currently tax crypto investments, and 60 to 70 countries in the future, with regulations being one of the biggest obstacles to further crypto adoption.

Binocs also plans to build more apps on top of its algorithm as it gets more data. “We envision ourselves as a data company that understands what’s happening in crypto transactions and builds applications for multiple use cases in the future,” Shingal said.

Binocs currently has pre-revenue and will monetize by operating on a freemium model as well as an enterprise plan for business investors.

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