Do you struggle with accurately tracking historical balances for crypto assets? If so, then you’re not alone.
Until now, obtaining a comprehensive report of historical balances of crypto assets on a specific date has been an incredibly tedious task that required manual data entry and hours of effort.
Before diving into the solution, let's explore why historical balances are a necessary component of crypto accounting, how you can calculate historical balances by hand, and the reasons why this approach may be difficult to scale.
Why Tracking Historical Balances is Essential for Crypto Accounting
Given the volatile nature of crypto prices, maintaining precise records of crypto transaction values and asset quantities is critical.
Here are three reasons why historical balances are needed as part of a complete crypto accounting process:
- Calculating realized gains or losses on a sale or disposal
- Calculating the value of a crypto-only transaction (whether revenue or expense) at the time of the transaction
- Calculating unrealized gains or losses for GAAP purposes
How to Calculate Historical Balances Manually
Block explorers, which usually serve as our go-to reference for crypto accounting, fall short in providing snapshots of asset balances at particular moments in history.
This leaves us with no choice but to resort to the tedious method of manually calculating our asset quantities in spreadsheets, then using external pricing sources to determine the fair market value for a given date.
As you might imagine, this labor-intensive approach is not only time-consuming but also highly susceptible to errors, making it a less-than-ideal process to be performed every month.
Automating Historical Balance Reporting With Gilded
Imagine being able to click a button and view the historical holdings and value of each crypto asset in your portfolio.
With our newly launched Historical Balances report, you'll be able to view ending balances for each individual wallet—or even all your wallets—at once. Your asset quantities and their corresponding fair market value will be determined based on reliable, independent pricing sources.
In short, you'll be able to quickly:
- Review asset balances as-of a point in time or during your accounting period for month-end close
- Calculate unrealized gains and losses on crypto assets held in your wallet at fair market value (FMV)
- Support reconciliations with a detailed balance history report
- Identify potential tax-loss harvesting opportunities
Speeding Up Your Monthly Close Process
Gilded gives you a streamlined process for reporting crypto activity on your financial statements.
With a reliable, repeatable monthly close process, you'll have more time to focus on other important areas on your business.
Plus, you won’t have to worry about whether your crypto financial records are accurate and complete.
You'll stay one step ahead of FASB guidance, enabling you to produce GAAP (or IFRS) compatible financials in a fraction of the time.