Nexo, a lending platform offering instant crypto loans, has entered into a partnership with Koinly to facilitate user tax reporting. The collaboration, effective from November 30, 2023, allows Nexo users to generate customized crypto tax reports easily. According to a statement from the company, this partnership is designed to simplify crypto tax reporting and aid in the preparation of financial statements.
Through the Nexo app, users can leverage Koinly to address their specific transaction histories and meet their tax obligations. Additionally, Nexo clients have the capability to access customized tax reports tailored to specific countries, covering over 100 jurisdictions.
Antoni Trenchev, co-founder and Managing Partner of Nexo, emphasized the company’s commitment to comprehensive financial solutions and enabling informed financial decisions through the partnership with Koinly.
Moreover, Nexo highlighted that the service automates the generation of accurate tax reports, streamlining the complexity of tax-related matters and reducing the risk of human error. Nexo users can access this service for free for up to 800 transactions annually. For users surpassing this transaction volume, a 30% discount is provided on Koinly.
This development follows Nexo’s earlier launch of a crypto-powered debit and credit MasterCard for users in the European Economic Area, known as the Nexo “Dual Mode Crypto” Card, offering various features, including tools to optimize tax responsibilities.
Simplification of Crypto Taxation
The increasing prevalence of Web3 activity has brought forth a common challenge related to accounting for crypto gains and losses, affecting both individual users and businesses. According to a July report from the International Monetary Fund (IMF), a significant challenge in taxing crypto assets is their “pseudonymous” nature.
For Web3 firms, in particular, accurately reporting crypto gains and losses on business tax returns involves tracking transactions across various blockchains and wallets. This necessitates comprehensive integrations with blockchain data to ensure accurate and thorough accounting.
Adam Saville Brown, Head of Partnerships at Koinly, emphasized the significance of the collaboration with Nexo in simplifying crypto taxes. He noted that the partnership aligns with Koinly’s mission to address the tax requirements of crypto investors, complementing Nexo’s innovative approach in the crypto financial services sector.
The statement also mentioned that Nexo has plans to launch educational materials on cryptocurrency tax reporting, further enhancing the resources available to users seeking to navigate the complexities of tax-related aspects in the crypto space.