How Cryptocurrency will Impact the Financial Industry

By Apac CIO Outlook | Friday, August 21, 2020

FREMONT, CA: Until a few years ago, cryptocurrency was a novelty concept, and only a handful of accountants dealt in cryptocurrency. Today, every major financial news outlet dedicates a portion of its coverage to cryptocurrency. It has gained significant traction and has become increasingly popular amongst the younger generations. As millennials and generation Z enter the working category, cryptocurrency is likely to become even more popular in the coming years. Here are some of the emerging trends for cryptocurrency.

Increased Automation

The increasing popularity of cryptocurrencies will result in traditional accounting services automating most of their work to keep up with the increased workload. Spreadsheets are good enough for flat transactions, but static tools will not be adequate to serve anyone with a serious investment in alternative currencies. This is mainly due to the highly volatile nature of the crypto environment. Simple software can do the job for taxpayers in the traditional accounting process. The same, however, gets complicated in the cryptocurrency realm. 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.

AI Accountants

Smart tools will help accountants enable their corporate clients and major investors to make better decisions. However, the general public does not look to accountants for simple crypto investments. Artificial Intelligence (AI) tools that minimize human interaction are adequate in most scenarios. Intelligent AI will be an integral part of the future of accounting, along with machine learning, and bots capable of natural language processing. Concepts like crypto cost basis, which can be challenging for the smartest of accountants, pose little threat to intelligent software. This does not mean that accountants will be out of jobs, but their roles will transform significantly as cryptocurrency transforms the financial industry. Not all people will be compliant with managing their taxes using AI. Accountants will need to lean on automated tools of their own to keep pace. Still, enterprise clients, substantial investors, and people suspicious of advanced tech will continue to prefer the human touch.