Step 1: Identify Your Crypto Interactions

Managing crypto transactions can be challenging for small businesses.

Initial Phase: Catalog Wallets & Exchanges

List every wallet, exchange, and protocol your business uses. Utilize read-only API keys or signed transaction hashes to gather all on-chain movements from the last 12 months.

Our process simplifies this step, requiring minimal technical understanding from your team.

Step 2: Connecting Crypto to Standard Accounting

The gap between crypto operations and traditional accounting can create confusion. We designed Midas Reconciliation Engine to bridge this divide by mapping blockchain transactions to standard accounting categories in real time.

Phase 2–3: Categorizing Transactions

Each on-chain transaction is tagged with:

• Business purpose (e.g., “Vendor Payment,” “Employee Salary”)
• Accounting category (e.g., COGS, Operating Expense)
• Tax classification (e.g., capital gain, ordinary income)

This automation is informed by real-world crypto transactions across various industries.

Step 3: Creating a Clear Audit Trail

Transparent records are crucial for audits.

Phase 4: Reconstructing the Ledger

Rebuild your general ledger from scratch, combining on-chain and off-chain records. Every journal entry links to a blockchain transaction hash.

For illustration:

| Date | Description | Debit | Credit | Transaction Hash | |------------|---------------------|-----------|-----------|------------------| | 2024-03-15 | Vendor Payment | $12,500 | | 0x1a2b3c... |

This approach ensures your ledger meets audit standards.

Step 4: Meeting Compliance Requirements

Preparation is key for audits and financial confidence.

Phase 5: Custom Compliance Checklist

Receive a checklist addressing key requirements, including:

• KYC/AML documentation for crypto transactions
• Tax election forms (e.g., Section 1031 deferrals)
• Clear explanations for stablecoin activity to share with your bank

This has helped businesses demonstrate compliance and maintain banking relationships.

Step 5: Final Review and Insights

Phase 6–7: Walkthrough and Key Takeaways

Review the final ledger and compliance package. Gain insights on:

• Crypto costs impacting margins
• Wallet access controls
• Explaining stablecoin activity to your bank

1. A fully reconciled ledger (on-chain + off-chain)
2. A compliance checklist reviewed by our team
3. A recording of the audit walkthrough

The Value of Clarity

Your focus should be on growing your business, not deciphering blockchain complexities.

A transparent and audit-ready treasury supports your growth, funding rounds, and banking stability.

Next Steps

Schedule your 30-minute on-chain treasury review today. Discover how we can transform your crypto activity into a compliant asset.