4 crypto trends for the next 5 years
Not long ago, only a handful of accountants dealt in cryptocurrency. Now, just a few years later, every major financial news outlet dedicates a portion of its coverage to crypto. Times have changed quickly, so what will the crypto accounting industry look like in five years and beyond?
Consider the following four trends in crypto accounting and how they will affect CPAs.
As cryptocurrencies further infiltrate the public consciousness, traditional accounting services will automate more of their work to keep up with the increased workload. Spreadsheets work well enough for fiat transactions, but in the volatile crypto environment, static tools can’t effectively serve anyone with a serious investment in alternative currencies.
Average consumers today can do their taxes online through services like TurboTax and H&R Block. Businesses and complex individual situations require personalized care, but standard programs can handle the load for most people. Tax programs don’t need to offer advanced functionality just yet — a few equations on the back end do a fine job.
But cryptocurrencies make things more complicated. Accountants need automated tools to track increased crypto complexity, like cost basis. Without smarter software, experts in the financial services industry won’t be able to keep up with higher sophistication at scale. Tax software providers will eventually offer new and highly automated services for crypto investors, and consumers will pay for those services using their crypto investments.
Accounting experts will use smarter tools to help their corporate clients and major investors make better decisions. But the public won't need real accountants for their simple crypto investments; they’ll simply turn to artificial intelligence tools that minimize human interaction in most accounting scenarios.
The future will see consumers interact with intelligent AI, machine learning, and bots capable of natural language processing. Challenging concepts like crypto cost basis, which can confuse even the sharpest accountants, pose little threat to intelligent software. Accountants will still have a place in the world, but their duties will evolve drastically as crypto demands bring widespread change in the financial industry.
Not everyone will feel comfortable doing taxes through AI. Accountants will need to lean on automated tools of their own to keep pace, but enterprise clients, heavy investors, and people suspicious of advanced tech will continue to prefer the human touch. With more money going toward nicer tools and less money going toward human intermediaries, accountants must specialize and adapt to stay relevant.
Schools and universities will soon offer programs and specialty courses to educate future accountants, bookkeepers, and CPAs on the intricacies of crypto. Few schools today offer such services, but the more prominent cryptocurrencies become, the greater the need will be for new accountants to understand the rules of digital currency.
Some businesses already offer services to certify accountants as crypto tax experts, but schools will remain the top trainers in the accounting world. By educating students before they begin their careers, universities can prepare graduates to operate effectively in an industry with broad new responsibilities and expectations. Businesses and crypto organizations will need new accountants who understand their evolving needs.
For accountants already out of school, options for continuing education will evolve from useful to essential. More crypto
trading means more crypto investors and crypto companies. Those entities need experts who understand the cryptocurrency landscape. If experienced accountants fail to adapt, fresh faces will gladly take the business. Updated regulatory standards
Where crypto regulation used to be nonexistent, legislators have actually made some limited progress. The SEC now has more oversight to shut down illicit initial coin offerings (ICOs), and the IRS clarified that cryptocurrencies are property, not currency — at least for now.
But the more that crypto changes, the more regulations will change with it. Every business that deals with cryptocurrency will encounter newer, more robust laws in the years to come. Soon every company and project that deals with crypto will need an accountant (or accounting service) with crypto experience to help navigate the unknown.
As new laws get passed, businesses will invest more heavily in smarter crypto accounting solutions. Artificial intelligence and machine learning will do the heavy lifting while human accountants interpret that data to help executives make smarter business decisions. More technology startups will emerge to cater to this growing audience. Before long, crypto accounting will become an industry unto itself.
These changes may seem like far-off concerns for another year, but crypto accounting — like cryptocurrencies themselves — moves quickly. Expectations and the tools to meet them become more complex and sophisticated each day. Accountants must stay vigilant to keep up with the times, or they risk losing ground to a new generation of crypto-savvy competitors.