TaxBit, a cryptocurrency tax software and accounting firm, announced today that it has raised $130 million in new Series B funding at a valuation of $1.33 billion. That makes TaxBit the latest crypto startup to earn “unicorn” status, or a valuation of $1 billion or more.
The raise comes just five months after TaxBit raised a $100 million Series A round at an undisclosed valuation, suggesting a rapid upward trajectory for the startup amidst increasing crypto tax regulation in the United States and abroad.
“We are in a stage of rapid growth. We’ve tripled our headcount and will do so again before the end of the year,” TaxBit co-founder and CEO Austin Woodward told Decrypt. “We launched support for various asset types including equities, commodities, and new forms of digital assets (NFTs, etc). In addition, we have plans for international expansion, with the UK on the horizon and other jurisdictions to quickly follow.”
Since March, the Utah-based firm has also become a software partner of the IRS and opened a second headquarters in Seattle. TaxBit has also added further financial institutions as partners, including crypto exchange FTX US, which now uses the firm’s Tax Center Suite.
IVP and Insight Partners led the Series B round, with participation from Tiger Global, Paradigm, Sapphire Ventures, 9Yards Capital, Madrona Venture Group, and Anthony Pompliano. IVP General Partner Tom Loverro has joined TaxBit’s Board of Directors as part of the fundraise, while Insight’s Managing Partner Nikhil Sachdev will serve as a board observer.
March’s Series A round was led by Paradigm and Tiger Global, with Coinbase Ventures, PayPal Ventures, Winklevoss Ventures, and Galaxy Digital amongst the investor pool.
TaxBit’s latest raise announcement comes just following the United States Senate’s passage of a $1.2 trillion infrastructure bill, which includes a controversial provision that expands tax reporting requirements across the cryptocurrency industry.
Crypto lobbyists and advocates contend that the language is too broad, and could affect network participants like cryptocurrency miners and transaction validators for proof-of-stake blockchain networks. Competing amendments to address the scope of the provision failed to garner enough support in the Senate before passage. The bill will next go to the House of Representatives for debate this fall.
TaxBit is one of many crypto-centric tax software platforms on the market, with competing services including ZenLedger, CoinTracker, and Accointing. ZenLedger recently raised a $6 million Series A round that included billionaire investor Mark Cuban, among others. The market for crypto tax software and services is poised for significant growth as more and more people invest in cryptocurrencies—and more become aware of their tax obligations, as well.
“For digital assets to successfully reach mainstream status, compliance with tax reporting and regulations is table stakes,” Woodward told Decrypt. “We make filing taxes on digital asset investments straightforward by providing users with real-time reporting and directional insights to optimize their trading decisions and tax liability throughout the year. We are bolstering growth of the wider digital assets market.”
TaxBit joins several other crypto startups that have reached unicorn status during this summer alone, including hardware wallet maker Ledger, NFT marketplace OpenSea, crypto gaming firm Animoca Brands, and financial services firms Matrixport and Amber Group.
News Source from Decrypt.co