How Crypto Funds Benefit From Using Crypkit

Cryptocurrencies have been designed to give back the power to their holder through decentralization. This means that we are now in control of our assets and have true ownership in a permissionless way. 

But the other side of the coin (no pun intended) is that having complete control means taking back the responsibility for securing and managing our assets. Those who choose to participate in this new asset class are willing to accept this new paradigm but since the market is still young, it’s not easy on them.

Tracking crypto data is not easy

Different blockchains use different wallets. There has been some standardization but everyone favours  their own ecosystem. Even though it isn’t recommended to hold crypto on exchanges, fast order execution and hedging against market volatility sometimes require it, especially to those that are into trading and digital asset management. Tracking your entry and exit points and an associated profit/loss made can be a daunting process. Even more so,  if the assets are bought directly and held in a storage wallet. Finally, even though blockchains by design have low transaction fees, the industry around it has high and varying fees. 

The needs of an individual market participant who purchases a particular crypto, either as an investment or for its use case, can be satisfied by a simple spreadsheet that can handle these variabilities. But if you are a financial professional that has been entrusted with managing the capital, then you can find yourself in a bit of a struggle to  successfully track the data. 

The complexity of accounting and DeFi support

Traditional accounting software isn’t applicable to this new asset class. The tools that are out there often don’t go further than a plain portfolio builder in which you manually enter your positions. These solutions are targeting retail and are lacking features needed for a financial professional

Besides the plain buying and selling, a crypto fund can perform other activities that produce profit such as; staking, lending, providing liquidity, and DeFi technology. They also have a fiduciary responsibility to their clients, and bringing transparency and facilitating communication can be challenging. 

The new generation platform

Luckily this problem has been faced by people from similar backgrounds and with similar needs. What started as a necessity-driven passion project for personal use, soon become a platform for the benefit of all. Crypkit is designed to be your go-to dashboard for your crypto holdings and assist you in tracking your activities. 

By connecting data from various exchanges, wallets, blockchain addresses, smart-contracts and DeFi platforms, as well as real-world assets like fiat deposits, you can finally have a visual representation of all of your holdings across multiple platforms. 

Connecting your data enables you to segment it into different pie charts and have complete control of what and how you see your assets.  It also lets you filter it in a preferred way and export it for external use. 

Advanced tracking capabilities

Besides having an interactive dashboard for presenting asset allocation the platform has essential and advanced features for tracking the funds performance. 

In the “Statistics” module you can find your “Performance” section in which you can take a deep dive into the numbers of your trading and investment activities and track your  PnL in real-time.  You can also access a graph of your historical performance. 

All of this data  can be shown in the desired currency and it can be bench-marked against various fiat and crypto currencies.  

Time-saving is the first obvious benefit that comes to mind with these options. However, having a clean and all-encompassing line chart of performance, as well as asset allocation pie charts, can really be helpful in reporting and managing stakeholders. 

Share data with your investors and auditors

This brings us to the next important feature. Unlike individual investors who manage money for themselves, funds manage other people’s money. Solidifying trust and ensuring clients with transparent reporting is thus essential. Crypkit lets you bring your clients directly to the platform. 

This feature enables the fund manager to see all of the information regarding the amount vested, profit/loss, time of the latest transaction, withdrawal. The client can see their portfolio and how well it is performing which results in fewer phone calls, especially in times of uncertainty or high volatility. 

Your clients will get their own login credentials to the performance data you will choose to share with them. They will feel like they have a complete overview of their vested capital. 

Usually, when someone deposits money into a fund they are left in the dark waiting for the fund manager to report back the results and feeling anxious and agog and potentially impatient to the point that in times of uncertainty they would rather request a withdrawal. 

Besides adding clients, you can add your colleagues that are involved in the asset management process but more importantly accountants and external auditors. This brings us to the next important problem the platform is tackling and that is tracing your transactions for accounting and tax purposes. 

Crypto accounting made easy

If you are an individual investor you don’t have to worry about these things because in most cases filing a tax report can be straight forward – in crypto/out crypto and pay the capital gains tax on the difference. But if you are a fund that performs a large number of transactions on time-frames ranging from a millisecond in high-frequency trading to years of holding a particular asset it has never been more important to have it all under one roof. 

The stakes of making these errors can be costly and the tax authorities can offer you a fine. Tax regulation isn’t still quite adapted to the emerging market and rules and requirements are always changing. This is why having all the information about your transaction history streamlined into one place will make you prepared to meet the needs of every regulatory requirement from the financial authorities. Still a common narrative is that crypto is used to launder money and conceal your transaction history so having a tool by your hand that demonstrates the opposite can be quite accommodating. 

For professionals by professionals

Crypkit has been built with the listed problems and specific needs in mind by the industry professionals that have experienced these difficulties first hand. 

As the market is constantly changing and growing, every day we are making adjustments to our platform to include the newly developed solutions that are contributing to the need of a sophisticated financial professional that engages into the market. 

Leave a Reply