Bitcoin ETFs have arrived. Token ETFs are next. Regulatory clarity is improving, and institutional interest in the crypto space is steadily growing.
With these market shifts, expectations for financial transparency and operational rigor are higher than ever—especially for crypto startups. As a crypto founder or CFO, it’s essential to establish sound financial practices early to meet these evolving standards.
1. Crypto Asset Classification Mistakes That Could Cost You
“Classifying your assets” refers to how you treat and present certain crypto assets on your balance sheet. With different accounting classifications, comes different reporting treatments. For example, treating crypto as inventory, a company would hold their assets at lower of cost or net-realizable value on the balance sheet, rather than at fair market value if it was treated as an intangible asset.
Incorrect classification can lead to surprise tax bills. Additionally, by not capturing fluctuation in fair market value, the income statement gains will be understated, along with the value of assets held on the balance sheet.
2. Raising Capital? Avoid SAFE and SAFT Pitfalls
It has become commonplace to issue SAFE or SAFT agreements to fund operations early in a company’s life. However, many company’s do not handle the SAFE/SAFT process with the proper due diligence, documentation, and reporting in a complete and accurate manner.
Mishandling these agreements can complicate future fundraising opportunities and create an inaccurate depiction of the Company’s financial position.
3. Your Chart of Accounts: The Key to Financial Organization
While QuickBooks is a fan favorite for many crypto startups, over-relying on QuickBooks templates can cause problems when trying to account for the nuances of crypto.
Clean financial statements will be useful for presenting accurate financials to investors, making budgets and forecasts, and streamlining any audit processes.
4. Taxes: Asking for Forgiveness is not a Viable Strategy
The IRS often targets crypto startups due to their lack of established reporting and tax compliance measures, as well as the perceived anonymity and potential misuse by bad actors.
When working internationally, ensure you have a strong understanding of the tax impacts in all relevant jurisdictions. Working with an experienced tax professional can be very beneficial in identifying potential tax liabilities before they occur.
5. Budgeting For Crypto Startups: The Key to Cash Management
Cash is the oxygen of a startup. Therefore, creating a relatively accurate budget and forecast, including key revenues, planned expenditures, and different success scenarios is key.
After completing your initial forecast, ensure you track actuals and compare to your original forecast to determine your forecast’s accuracy, and adjust if needed.
6. Investor Relations: Don’t Let Sloppy Financials Sink You
While unique ideas and vision for the Company are important, action and operational execution are paramount to bringing those ideas to life. Part of the operational execution that investors, regulators, and users will look for are complete and accurate financial records.
The foundation to ensure your investors have the accurate reporting they need, while providing required documentation to regulators.
7. Build a Scalable Finance Function
QuickBooks may work for a seed-stage startup but will need compliments to ensure it can scale as your company scales. However, cost efficiency is also key, so operational systems and cash management can be a balancing act.
Test platforms before committing. Various subledgers and accounting system exists. What worked for another company may not work for you.
https://www.thenetworkfirm.com/blog/2025-crypto-startup-accounting-guide
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