On September 8, Blockpit – Austrian compliance expert and developer of software solutions for digital assets – announced that it acquired the German startup company and its biggest competitor, Cryptotax. Both companies offer tax software for cryptocurrencies and currently provide tax reporting services in Germany, Austria, and Switzerland. Now that the two largest European crypto tax firms would be operating in one roof, sources revealed that global expansion was next on the line. Coverage for new markets was slated next year, targeting the United States, the United Kingdom, Canada, Australia, South Korea, and other EU countries.
Though both firms have similar offerings and operate in the same market, the founder and CEO of Blockpit Florian Wimmer told Tech. Eu that these two organizations “have different focuses and strengths.” CryptoTax provides tax reporting frameworks for crypto and non-crypto assets that can be adjusted to different countries. And its competitor, Blockpit, offers tax reporting and know-your-transaction (KYT) compliance tools. Both founders shared that this acquisition will make them a full-scale RegTech company in the market, noting that one of the reasons for merging is to penetrate the international scene. Klaus Himmer, co-founder and managing director at CryptoTax, told Cointelegraph that “The medium-term goal is to combine both companies to a renowned global player as well as an intensive expansion into the U.S. market.”
The merger was close to a 50:50 deal, and Blockpit plans to raise €1.6 million (~$1.9 million) from both companies' existing investors and get the ball rolling on an extended Series C to fund the U.S. move, said by Coindesk.
These firms took a bold move that certainly would demand changes in some parts of their organization. Blockpit and CryptoTax executives noted that the union would not affect their existing customers in any way as they would keep their offices in Linz and Munich. Over the next few months, the company’s representatives said that the CryptoTax frontend would be redesigned and adapted to the Blockpit interface.