On The Brink with Castle Island - Pat Larsen (ZenLedger) on the State of Crypto Taxes (EP.312)

Episode Date: April 25, 2022

Pat Larsen, founder and CEO of crypto tax prep company ZenLedger, joins the show for a timely discussion on how investors should be thinking about taxes this tax season. In this episode:  The outlook for crypto taxes in 2022 Tax accounting for specific transactions Clarifications and improvements to tax regulation ZenLedger provides a platform that makes it easy for users to aggregate transactions across centralized and decentralized venues and measure their crypto tax impact. The team published a helpful guide on nft related taxes.

Welcome back to On the Brink. This is Ria from Castle Island Ventures. In this episode, we sit down with Pat Larson, co-founder and CEO of Zen Ledger, to talk about everyone's favorite topic, crypto taxes. We cover everything from the state of crypto taxes in the U.S. today. What are Pat's specific thoughts on how crypto tax rules could be improved, and the specifics of how certain types of transactions and entities in the space are taxed. This is an important and timely episode, so let's turn it to our conversation. Hi, everyone. Welcome back to On the Brink. This is Ria from Castle Island Ventures, and I'm joined today by Pat Larson, who is the co-founder and CEO of Cryptotax Platform Zen Ledger. And Pat, I think this is your second time on the show.

So welcome back. Thanks for you. I appreciate it. So before we dig into crypto taxes, could you give us a refresher on yourself and on Zen Ledger and maybe talk about how Zen Ledger has evolved since he were last on the show? Yeah, sure thing. So grew up in Southern California, half-eighths me, grew up next to a little Saigon there. Went to the Air Force Academy for undergrad, studied chemistry there. was in the Navy as a search and rescue helicopter pilot with a couple of combat tours.

I got out, got my MBA at U.S. Chicago, was in MNAI banking for a bit, and then have been in fintech on crypto for the last 10 years, ran business unit Amazon and co-founded Zen Lager in 2017. We started it as a turbo tax for cryptocurrency company. We kind of looked around, saw the IRS was sitting in Coinbase, saw that ICOs are going crazy, and the thesis was, hey, you know, billions of dollars are going to flow into companies here, VC capital is going to flow in here, and that's going to kick off millions of people getting into crypto and the whole asset class going

barkers. So we looked at existing tax tools and kind of saw huge gaps in the market. Every smart person we talked to didn't tell us to, you know, build a decentralized, you know, sentient AI in the cloud on a slow database. They told us like, I'm having trouble figuring out my taxes, my account and my lawyer can't figure it out and I can't figure it out even when it was a very savvy person. So we kind of figured, hey, you know, get it right first and foremost. And to do that, you're going to have to ingest transactions from everywhere from day one, on-chain, off-chain, allow for auditing, allow for accounts to come in, API, CSV,

whatever to upload, and then clean it up and output it to useful reports. and have great customer service, U-I-U-U-X. And from there, over the last four and a half years, we've raised four rounds of capital, about 12.5 million in total. We'll hopefully be closing on another round pretty soon, so happy to announce that. And we've kind of morphed into a data company

and have products that help government investigators chase down money laundering and human trafficking and tax evasion enterprise, helping them with corporate accounting. We help $100 million defy fund out of Valkyrie, among others, and help lots of individuals and accounts with individual tax filings from big four accounting firms in their old time network practice, down to token founders in Wales and down to individuals

who are just on a couple exchanges and just have like a metamath quality. That's awesome. You answered one of my next questions, which was going to be, how has the end user base that Zen ledger is serving changed over the course of running the business. So, yeah, maybe talk about how it's changed. Maybe initially when you started, who was the key stakeholder. And is that different now? It stayed the same the entire time because an individual who's jumping around to a bunch of different places, on-chain, off-chain, you know, Korea, US, Bitcoin, ARB, Om clone, chasing, NFT, minting, NFT, trading, defy, like all that.

Those are incredibly complex use cases, and that forces us to be really smart about bringing in on-chain stuff and then mirroring it to off-chain stuff and then being able to clean it up and report it and do LIFO, FIFO, tax loss harvesting, full audit reports, all of that for the individual. And that robustness of what we give the individual, what they need from if you have a couple thousand dollars in crypto network to tens of millions of dollars in crypto network, it's the same. So the software is going to work for you regardless. Just like in Excel, you can add one plus one or you can add $10 billion plus $10 billion. The software has to be able to handle both.

Our software has to do the same. And so it just happens that our individuals can be very simple or they can be. be extremely complex. And the very complex individuals actually surpass the complexity of corporate accounting. Generally, corporations are not training in out every day. They're holding stuff in cold storage or they're operating solely on their own chain. And then they generally know what they're doing, but we can just hop in Slack and talk to their CFO and their core dev team and figure out a little bit more of the ins and outs on that specific chain. And then we surface those learnings to the individuals too. So if you love Avax or Fanta,

or Ethereum or Solana. Like we've talked to like dev teams in all these areas and we've got smart all of them. And generally you're on all four or five or six EVMs. You're not on just one or two. So you kind of need to be able to handle all of them or none. So we've gone with the perspective of, hey, we need to be very broad, but also like incredibly thorough and rigorous in our integrations with each one. Because you have to get it right from day one and across everything to get your taxes right today.

And taxes are just kind of an all or not. thing proposition. Got it. And so you mentioned, you know, an individual can either be, have pretty straightforward transactions or you could be dealing with someone who has more complex transactions to report. Is that all automated by Zen Ledger software? Or is there, for certain clients, do you provide kind of more hands-on?

a customized experience. Yeah. So if you want to, we'll marry you with a CPA in their firm with a bunch of legal and accounting experts there. And they'll do the all in like all done for you type stuff where, you know, you have an accountant looking at and cleaning up everything, get ready for you. Those costs, you know, thousands of dollars per year. Otherwise, if you want to do it as an individual and just do it yourself with no outside

help, then the difficulty of crypto is the clusiness of it. You know, we build in security, we build in 2FA, we build an encryption. And that means that no software can just go in and read all of your transactions and clean it up very quickly for you. Even TurboTax needs you to input your W2 and your 1099B and, you know, what you paid in student loans this year. And that stuff's like much, much more simple than all the cryptocurrency investments that most, people do. So we never have your 2FA. We never have the ability to create APIs or download CSVs from you. So we work with you to help you go over to Bitrix and like, you know, request from customer service, their deposit and withdrawal files, or, you know, create your API at

finance and finance US or Coinbase and Coinbase Pro and those types of things. We kind of walk you through all that cluginess of Web3 where, you know, it's your keys and your crypto, but therefore you have to input everything or at least allow read-only access to centralized exchanges and APIs. Because we don't assume that when we see a metamask that you've uploaded, that the next metamask next to it or something is also in your possession. So you have to go through and tell us every single wallet that's in your possession. And sometimes someone will just forget, like, oh, I had a salon of wallet. I did like 20 transactions on it two years ago.

Totally forgot about it. But now in Zen Ledger, I see that there's a gap of these like Salana transactions, and that reminded me to go get that receiving address and put it into Zen Ledger. So we do have AI and algorithms that will point out these holes that will remind you, you know, of some of the gaps that are very hard to keep track of over three or four years of trading. One thing you hinted at, as you were naming some of those exchanges, is the fact that crypto infrastructure is still pretty fragmented. across both centralized exchanges and decentralized platforms. So I assume Zen Ledger is laser focused on integrations with some of these platforms and aggregators to provide end users with, you know, the richest, most comprehensive experience. Could you talk about some of those integrations and maybe which integrations have been the most

challenging? Yeah. I mean, I'd say that the integrations will just, you know, what makes it challenging is if the centralized exchange keeps changing things and keeps breaking the integration and you have to fix it or wait. So the exchanges that are constantly changing things make it more difficult. The blockchains generally do not change things. You know, that's the nice thing. They try to get right the first time and ship it and then it's there. You may have some deterioration in the blockchain, but most of these projects are pretty well-funded and there's like really smart people working in them with good documentation. So we haven't really found like, oh, one blockchain is much, much harder than the other.

Obviously, blockchains that are not kind of Bitcoin clones or Ethereum clones are more difficult, but you can figure them out, especially when we reach out. You know, Al-Gran via Borrelless capital invested in our last round, and there are a couple blockchains represented in our next round. So that's going to help us as well get these integrations really solid. And, you know, so I think we've, we have. have like a really good dev team that has a lot of experience doing this stuff. And so it's kind of like it is basically what we do. One of the outputs of all these integrations is taxes for the individual.

But you know, like one year bringing in tons of transactions, clean them up and reporting them out. It's pretty flexible. We can help with portfolio tracking, you know, investment management, audit, investigation, you know, reporting, taxes, accounting. Like it's pretty broad because basically everything's kind of happening, like the whole economy of crypto is happening in either centralized exchanges off-chain or on-chain. And like we're trying to look at all of it. Could you just taking a step back refresh us on the state of crypto taxes in the U.S. today? How is crypto classified by the IRS and maybe touch upon any notable changes or clarifications in the way digital assets are taxed since you were last year?

Yeah, I mean, unfortunately, there's not a lot of clarification. And the state of crypto taxation is pretty gray. So we've had some guidance from the IRS from 2014. They've given a couple updates since then. In 2018, there was a small mention in the tax bill that 10-30 where exchanges are only allowed for real estate, therefore not allowed for crypto. President Biden just had an executive order that said, hey, let's research crypto more. And then the build-back better plan had all sorts of crypto stuff. it hasn't passed into law and then the lot of the things in the bill back better bill were rulings and judgments that you know treasury department would have to make going forward and those would have been lobbied against or litigated against or amended by further laws so we're still pretty early on there's no comprehensive tax plan there cryptocurrency is tracked as if it were property in practice it's used as if it was a tech stock for speculative investment or kind of a medium exchange, you know, maybe maybe cash or some other kind of commodity precious metal. It's kind of used in many different ways.

So you can kind of be conservative or aggressive in your tax treatment. Just be ready to justify it. Be ready to end up in tax court and fight over how staking should be categorized, things like that, which happened in a recent case. So we're just very early on. any countries in the world really have a really great idea of how to tax it. But some countries are a little bit more lenient in. They say, hey, our country will be a sandbox and there will be de minimis.

And we're not going to worry about it for right now because there's just not enough capital and economic activity happening. Where's the United States now, the difficulty is that every Fortune 50 company has blockchain and crypto designs. Every bank wants to do stuff there. Every tech company wants to do stuff there. a repayments company. And so that's a lot of lobbying heft and lawmaking heft and revenue and profit generation heft in the Fortune 50. And so I would be surprised if in a year two we didn't have a lot more clarity because these big companies need the legislative cover to really deploy capital and make long-term investments in the space. And last time I checked

Fortune 50 companies usually get the laws and regulation they want. And do you, do you personally kind of agree with the way that digital assets are taxed today? Do you think it makes sense in the U.S. specifically? And if not, I guess, what would you want to see change? Yeah. I mean, I'm not someone who thinks there should be no taxes. I think that's childish. I like the infrastructure that we enjoy. So, you know, I don't think there's anything wrong with tax optimization. I do think that American companies have gotten very, very good at shifting stuff over to Ireland and back or whatever, and Delaware is quite useful for that. So it's not necessarily a new world we're living in. Crypto probably allows people to be more aggressive

with what they're trying to claim to start. I do think some sort of sandbox where we allow for a lot more innovation and a lot more kind of, you know, free investment to start would be really useful because cryptos like, you know, the internet or software, it's going to affect the global economy and we should allow American companies to foster that. We shouldn't create situations where very smart, hardworking, you know, Americans or anyone else in the world decides not to come to America to start their businesses and decide to go to Switzerland or Singapore instead. This is where you should be building your startups in Miami or New York or Boston or Chicago or San Francisco or L.A. or Austin or anywhere in the U.S., right? Like this, this is kind of like

where the action's been for 50, 60 years and we should try to keep that lead in tech and fintech and finance and innovation. So a de minimis and some sort of sandbox I think make a lot of sense. and just don't let large companies kind of capture the innovation and protect monopolies that they'll never be able to build. I think every large company had designs to be some sort of crypto monopoly in their own space, and it proved to not work out at all because that's just not how Web3 and crypto works per se, but that's what they wanted. And hopefully they've given up on that. But it's kind of very much in flux still, I think.

And what do you mean by de minimis? So, so say like up to $1,000 of profits or transactions each year are completely untaxed, right? Or you can buy all the cups of coffee you want for $5 up to a certain amount. Like you can't buy $10 million of cups of coffee. But if you're just going around spending Bitcoin each day, you don't have to worry about the capital gain loss on that, on that Bitcoin you spent for, for coffee. And that would just free up. all the payments rails and it would allow for further adoption, it would make for incredibly efficient remittance.

So one really interesting thing about crypto is that now that Western Union and local money changers don't get their cut, the family that you're remitting to gets 50% or 100% more of what you send. Instead of sending $100 and they get $50, you send $100 and they get $100. And I think in poor countries that depend on remittance, that has real impact. that that's going to like reduce infant mortality, increase education, you know, reduce violence. So like that's real good stuff that you get because you're eating into the margin of payment processors and local money changers because now you can pay for your rent in El Salvador and Bitcoin and I'm assuming probably in West Africa as well. So so those things are super cool.

That's because there's a complete lack of regulation, but an admission that crypto has value and can be spent readily in a bunch of different places. So the transaction costs go down and the rent seeking goes down. One thing that still trips me up is how airdrops are taxed. And it's obviously relevant as it relates to defy applications that might air drop governance tokens to users. But more recently, we're seeing things like NFT projects and Dow's air dropping tokens to stakeholders. Could you talk a little bit about that? Yeah, it would be as if you were walking down the street and someone gave you a stock certificate for one share of Tesla and you accepted it, right?

Like, um, so it's nothing new. It feels a little unfair, but at the same time, like, hey, it's free money. So just like pay your taxes on it. Uh, so today, say today you get $100 worth of token X, right? So that would be $100 of ordinary income today. So call it 30% taxes you own that. So you owe $30 on the $100 of income you made today. Especially if it's an airdrop, you probably didn't do too much work to gain it except for stake something.

And then now you hold token X and say it goes up in value over the next six months to $150. And then you sell it for $150. You made $50 of gains, of capital gains in six months. And so that's a short-term capital gain of $50. So say you owe 25% tax on that $50. So $12.50. So you've paid $30 plus $1250 of taxes, but you've pocketed, what, 70 plus 3750 or something, right? So that's kind of how income tax works on air drops. It's income at time of receipt. And then there's, then you just treat it like a tech stock as well because it's a token. And you have a long or short term capital gain or loss when you sell the token. Another new area of focus for you has to be NFTs. And, you know, the majority of NFTs are denominated in ETH. How are taxes on NFT purchases and sales calculated? And has that been challenging for Zen Ledger to support an account for these transactions or is it pretty straightforward? Oh, it just used the floor price because it's so rigorous and official.

I'm kidding there. So, you know, like Ethereum is always has a dollar price to it. Like, you know, it's a very liquid market. So we can always price every transaction in dollars. That's pretty easy. NFTs are really cool and I'm glad people are buying them. I think name image likeness for college players is going to kick off a ton more NFT usage. And that means income and capital gains for, you know, tens of thousands more individuals, if not more.

And then, you know, pro athletes and around the world, I think will do the same thing. Everyone kind of wants the best and, you know, scarce moments of top athletes as they win gold medals or, or, you know, soccer football championships or whatever. So I think that NFTs are kind of going to explode. We'll get past the silly, like, this is just a JPEG, even though we all, we all love our memes and our, you know, even stock photography has value. I think we all admit. So that's all fine. We do support a lot of NFT stuff. We actually released our own NFT tax guide.

as an NFT and sold it out to the community. And so you got some unique art and you got our up to date tax guidance. And we worked with several lawyers and accountants that were really taking a focus on NFTs. And we can kind of link to that, I guess, later. I don't want to rattle off their names because I'll forget some of them, but Andrew Gordon and Jacob Martin are key among them. So, so yeah, like we're not exactly sure if an NFT needs to be taxed as a collectible, which is like a 20, percent tax rate or something else. Again, there's no laws that state how we need to think about NFTs and is messy, but they'll start to get more and more valuable. So companies will kind of

sue over NFT IP rights and we'll get some case law in court as well, just like we had to do with the digitization of songs and movies and pirating and all that. Another new category that it'd be great to get your take on is Dow's. You know, more people are working, maybe part-time or even full-time in some situations for DAOs and getting compensated in an entirely new way. Have you spent a lot of time thinking about that? Is it pretty straightforward or are there any nuanced considerations for people who are doing more work for DAO's and getting compensated for that work? Yeah. So the DAO work, I think, is pretty straightforward. It's just like, hey, this, you know, this one eath is income and it was for working for that Dow, so it goes as an ordinary

income. And if I just keep the ETH, then there's no capital gain. I can go stake it. There'll be capital gain, even more income on the one Eth I earned. So you can kind of stack your Eth that way or whatever, wherever the Dow is operating, which is kind of fun. But like that stuff is pretty straightforward. Like you do work, you earn something of value for that work, and then you have income tax on that. And if the thing that you're, we're compensated in has, you know, can appreciate in value, then you're going to owe some sort of capital gain. If someone paid you with a house or someone paid you with a piece of art or, uh, um, a stock certificate to a publicly trade company, it would all basically look the same too, right? You would have to price it and everything.

What's really interesting with Dow's is what happens if you bought the constitution and like, how do you value that and how do you worry about that going forward? Uh, thankfully, the United does not have a wealth tax, but if you're in a country with a wealth tax and all of a sudden you own the U.S. Constitution, now you have to really think about it and you have to worry about marking it to market quarterly or annually, and then you have to liquidate some of your holdings to pay some of that wealth tax because you own a portion of the U.S. Constitution, but you can't sell, you know, the U.S. Constitution. So, like, those things get weird if there's wealth taxes, but if they're not wealth taxes, the actual admin of the Dow's themselves and the assets you're

buying are a little different. If the DAOs are very active in what they're buying and selling, then again, that adds the complexity. And you really can't decentralize that. You need a centralized accountant to look at everything and cleaned up and help everyone to report it. Yeah. So talk about that a little bit because, you know, we've seen growth in investment and collector DAWS, for example. So maybe talk about collector DAWs that are buying and selling NFTs. Yeah, yeah. Now you're getting into a little bit deeper water that I don't I don't I can't expound on nearly as easily but I would say that um you do like you'll have a market price for the asset you just purchase and and and that will like be on the books of the Dow there'll be a balance sheet right um whether you have to comply with some

laws or regulations and where your investors are um you'll have to value those more often or less often. And then when you dispose of them, you're going to have, you know, a gain or a loss on that. And, you know, do you pay corporate taxes? I don't know. Do you have everyone, like, do you dividend out to everyone? And then they have to pay a dividend or income or capital gain, like, we'll see, right? It's, it is, it is a little bit murky. I'm sure there are accountants and lawyers who are very much better versed on this. But I think even they would admit that, like, they don't really know how it's going to go. And you could just get a law tomorrow in the EU, UK, Switzerland, or the U.S.

That states something completely different, and that's the new law of the land. Got it. So in those situations, it's a little bit more case by case, I guess, depending on how the Dow is structured, who's involved in the Dow where they're based, and I guess how the Dow is, like what kind of the corporate structure of the Dow may be? Yeah, I mean, basically you need large stakes for any. anyone to care, right? So you need some $100 million Dow to go buy a bunch of assets and then they're going to take some stance like, hey, we're going to be incorporated in the Isle of Man and we're not

going to pay taxes. And then some government's going to say, well, 70% of your members reside in our country and we want income and capital gains. So like we think you're based here and here's the lawsuit. and like that's how things are going to hash themselves out over time. But we're like years from that, I think. I guess while we're on this topic of DAOs and NFTs, another thing that we're seeing more of is maybe Dow's issuing NFTs. So how does that work? Say you, a DAO puts together an NFT project, sells it out,

continues to make some portion of secondary sales, how does that work? Yeah, I would say, again, it's a little difficult. And so what you're really worried about there is the income tax because someone has given you something of value. And you're going to, you know, for income optimization or for tax optimization, you're going to want the lowest price possible for that income received generally. but then when you sell it, you're, you know, that's maximizing the amount of capital gain. So like, you're kind of, you're going to pay the taxes somewhere along the line, but you prefer not to pay it up front because getting an NFT and paying taxes and cash on it makes you cash poorer than you were yesterday, though you are NFT richer.

And, and so I think that, you know, like, you need to come up with a mechanism where you're pricing these. most of these NFTs generally have a pretty liquid and obvious price at issuance of whatever. 0.1eath or 0.4th or whatever. After some time, it gets a little wonkier. Like, hey, the floor price for these ones are 50th because they're so rare or whatever. Okay, great. Like, I don't know about that. The IRS won't know about that.

You can claim what you want, right? It depends on how conservative aggressive you want to be. And we forgot to do the tax disclaimer, but, you know, like, none of this is financial. or tax advice. I am not a lawyer nor an accountant, nor am I your lawyer or accountant. So, you know, just take this all the grain of salt. But, you know, like, again, if it's low stakes, you just own some, like, tiny NFT that's worth, worth $5. Like, no one's coming, like, to bother you about it. But if you're running a Dow, like, auction house and you're self-dealing, selling NFTs to yourself for $60 million and then selling it to someone else and shifting it over to

Ireland and all these things, then someone's going to start taking a closer look at you, right? So I think it's a problem for five or ten very loud people on Twitter and maybe for another couple hundred, but it's not a problem for all the people kind of getting their, their NFT air drops and just buying and selling NFTs and trading them a bit and playing in Dow's. Like try to account for this stuff. It's on-chain. There's generally an on-chain price for what you can have. But again, since we don't have a wealth tax, all you're really worried about is the price when it came in as income.

And then when you sell it, there's a market price. And that's really easy to pinpoint too. You know how much you sold that FD for and you know how long you're holding it for. So you have capital gains and a holding period. Got it. What is the most common misconception that you hear from clients as it relates to crypto taxes? Yeah. I wouldn't say it's a misconception. I think it's actually pretty accurate. And it's that like I don't have to pay taxes because no one's looking. But I think that that's obviously going to change.

Some people have gone through extraordinary lengths to move to Puerto Rico and to create Roth IRAs and corporations and all sorts of other things because they they believe the tax man's coming. You don't move to Puerto Rico because you don't, you think, you know, taxes aren't happening and you don't move to Portugal or whatever either. This is the first year, 2021. we're on your 1040 individual income tax return in the United States. The first like question you answer basically after you fill in your name and where you live is at any time during 2021, did you receive, sell, exchange, or otherwise disposed any financial interest in any virtual currency. So there's a six year counter going there. And every year that you kind of like don't answer that question accurately like starts the six year counter again. It's kind of like an Al Capone thing.

It's why they went after John McAfee as well. The United States realizes that more and more economic activity is going to move into crypto. And they don't want to just create this whole black market, gray market of untaxed capital assets. So you're going to see more and more audits going forward. And every place in the U.S. that you can fiat on ramp, off ramp, is KYC AML. So it's very hard for you to answer no. on page one of your 1040 and then to also get 1099Ks from Gemini and finance US, FTX US, will be US, Coinbase. And think you're going to get away with anything. And if you have significant

assets or income, you're going to have a tax professional and that tax professional is going to ask you point blank, you know, should I check yes or no here. And it's pretty easy to see on your bank statements, a wire in or out of Coinbase or Gemini or wherever also. So, you know, like I think it's a question for 2013 Burning Man, sovereign individual, sovereign wealth,

my keys, my crypto people. But the marginal customer who gets into crypto who talks about with friends at work who sees NBA,

NHL playoff ads or Super Bowl ads or their favorite athlete is now talking about crypto, you know, Steph Curry or whatever with FTX. Those people are very used

to having a W-2 and they pay taxes on it. it and they get a 1099B from e-trade and they pay taxes on it and they'll just get you know a 1099k or something from exchange and it won't occur to them that they should massively like become a federal felon by evading their taxes they'll optimize you know like some people are more aggressive than others some people put their minivan on their tax return or whatever but but like the next five million people in america that all get into crypto aren't doing it to lie about what what what crypto they hold. They're getting into it because they want it to appreciate and value,

just like Gamestock and Sheave and Doge. They're buying it because they think it's an asset with alpha, not because they think it's a great money laundering implement. So you touched upon this a couple of times, but you are wrapping up your next raise. Tell us a little bit about what's next for Zen Ledger. What are you excited about that you're working? working on. Yeah. So thankfully the round was oversubscribed. So we got to make sure that all the investors were a great fit. And that's what we were able to do through Seed and Series A as well. Our investors have been really helpful and fantastic. But so like I think that the next things we'll do are expanding internationally because a lot of these investors are actually based overseas

and can help us enter additional markets in Europe, you know, Mena, South Asia. East Asia because there's just so much activity happening there and other countries kind of realize they need to tax stuff too they look at the US and EU to take the lead or barring that they look for ways to arbitrage that regulatory difference like like an Estonia or Switzerland or a Singapore might do so we are looking to expand internationally in scope we will be you know offering portfolio tracking and so we're kind of doing some product innovation as well so those are the the big things we're doing. We've grown from 15 people to 45 people in about nine months. Me personally as a CEO, I didn't know if I could hire a C-suite, which is what Series

B requires, but we've actually just made fantastic hires at CTO, C-O, CFO, and Chief Strategy Officer, so we'll be announcing those hires soon as well. And so the team will probably be growing to 75 or 100 people. That's awesome. Well, congratulations on all of that is clearly a testament to all the traction you're seeing and the business that you've built. So very excited to hear that. And then I guess last question, just putting aside Zen Ledger and taxes, what are you personally most excited about in crypto and Web3? Yeah. I mean, I think that we're getting better with the clujiness. Like I still, if I'm doing a bunch a defy stuff on one chain and I leave for a month. It's all changed when I come back and I have to

watch new YouTube videos and then like I forget that I need gas in one token and then I need to unstake and another one and go over here and wrap it and like it's awful right like all of it's so terrible just trying to get high API on it and mess around. I do think that NFTs are much more accessible. And if you start wrapping a defy in NFTs, that'll be interesting. Like, you just have someone else take care of all the, the defy stuff, and

you get a claim to it by purchasing that NFT, and you're jumping in whatever Discord, or hopefully whatever displaces Discord, because, again, Discord is Kluji and horrible as well. You know, like, we're still, like, in a transition from Web 1 to Web 3. There's a lot of Web 2 stuff that we just skipped over.

And, you know, like, Craigslist is still the best thing out there. And all it did was replace local newspaper wanted ads. And it's still like by far the highest utility of anything on the internet, which is hilarious. And we still haven't figured out payments at all, right? Like we talk about Elon Musk and Peter Thiel and PayPal. And we're still like still don't have payments down. So I think there's just, we're just still so early and there's still so much innovation. I think name image likeness and NFTs is going to be really cool because you're going to get all these fantastic athletes as champions for crypto.

And that's like, that's what we do. We pick people who are objectively world-class and what they're doing, generally sports, because you can run the race the fastest, you can win the championship, and there's not much arguing about it. And those people are going to say, you know, like, hey, you know, like, buy my jersey or show up to my jersey signing or get my exclusive trading card here via NFT. And artists can do the same thing. You know, Wu-Tang Clan made a one-off album that is now owned by Pleaser Dow, which is fantastic

because Martin Scorrelli never deserved to own it. So there's just a lot of cool things that are happening with ownership and transportability of this value that I think is super cool. That's great. Well, I will link the NFT tax guide that you mentioned, but what is the best way for listeners to follow what you're doing, to use Zen Ledger? And yeah, give us that as a quick...

as a quick last answer. Yeah, sure thing. So just go to zenledger.io, z-en-l-edger-g-r.io, and just get started there with taxes. We have a bunch of crypto 101 stuff. We have great customer success people standing by. Please, you know, leave us alone until after April 18th and give us a little bit of a break, but we're happy to help you afterward. You can find me on Twitter at Patrick Larson, L-A-R-S-E-N, and our company at ZenL-L-L-L-E-O.

But just, you know, ping us any time to any questions. We're always happy to help. A lot of stuff is super esoteric and you just kind of need software to take over for you. And we're happy to help. Awesome. Thank you so much, Pat. This, I think, will be perfect timing because we're just coming up on the, I guess, the first deadline. Yeah.

I expect most people, yeah, most people that have been in the crypto game are going to file their extension. So just keep us in mind in August, September, October, and we'll, you know, hit us up and in, you know, July and August, please, so that we can take care of you early on and you're, you have less stress and we have less of a traffic jam trying to get these filings done. But happy to help everyone out. Yeah, we'll definitely bump the episode when that time comes around. Thanks so much, Rio. It was really fun chatting with you.

This was great. Thanks, Pat.