Koinly so far is probably the best tax and portfolio tracking software. They have the most advanced features with the nicest user interface. The only problem is they do not fully support Dot yet. I think this is part of the reason why Dot adoption has not been as successful as we had hoped it would be.
Currently, I have to track my Dot transactions manually and that’s fairly difficult to do. My totals always come out being a bit off. This mostly has to do with DeFi transactions on Subscan not being the most human readable. That could definitely use some improvements. But, for now I think it’s more important for our parachains to be seamless for the end user wanting to track their portfolio and tax burden.
I currently have a support message out asking them how much they’d need to give us priority for adding support for the existing parachains. I’ll gladly propose a referendum with funds needed from the Dot treasury once I hear back from them. But, till then I think we should discuss developing a useable solution for users. I have a feeling a ton of users are afraid of tax compliance, and that’s partially responsible for the liquidity issues many of the parachains are experiencing. Manual tracking of these transactions is just too easy to lead to misreporting of earnings for tax purposes, and any potential fine could easily outweigh any gains.
So, what would the community want before paying Koinly to give us priority?
Their tracking software is also good for tracking P&L across parachains. The other option is Polkadot implements something themselves, and then Koinly pulls from that to get data from all Polkadot parachains.
How Koinly works is they prioritize popular chains, and us paying them might get us bumped ahead in line. Which in turn would be good for adoption of Dot. Our primary competitor is Cosmos, which Koinly supports many of their chains, while only supporting Moonbeam from ours. We either need to organically grow over multiple years to gain support, or pay them to prioritize supporting our ecosystem. Bit of a chicken or an egg situation.
Currently, tracking Polkadot P&L for a Polkadot portfolio is a nightmare. I believe that’s a portion of the reason various parachains are having liquidity issues, and we’re starting to centralize on a few chains.
Would be interested to know what kind of data they need. I’m also using koinly and it sometimes complains about missing DOT or it is not really aware where the DOTs are coming from. I assume they have some bugs, because I don’t do that much crazy shit
Maybe they could directly use dotlake (CC @Karim) to pull the data from there. I think first we really need to get some contact of them to get an understanding how their stuff works and what they actually need.
I’m trying to get in touch with them. I have a message out on their support chat about it. I’m going to try reaching out to their partnership email. Koinly is only 4 developers. They must be making a killing. Maybe, we can invest in them, and generate income for the protocol in the process.
Posted something similar and provided similar suggestion. Got no responses back. If Polkadot wants to be ready for this run, they need to figure out tax support. I know alot of folks that check whether their tax software supports a chain before they use that chain. Right now, almost no chains are supported outside of Polkadot Relay. For that matter, tax software is also to my knowledge unable to pick up transactions on asset hub.
Thank you for the mention @bkchr , this is a great initiative and opportunity. Our current DotLake focuses on two things: precision and exhaustiveness. Providing Koinly access for a POC & trial around this type of use case is a great idea and ensure a proper representation of DOT holders wherever their assets might be in the ecosystem. As someone living in Germany, I do agree with @Barakion that tax support/transparency is key.
I do not know how much Koinly would need “regulatory compliance” around the datasets but we can explore this venue and get the maximum speed around it, as the benefit to DOT holders is clear. I think basing such a solution on our common expertise and data could be great, especially to make sure there are no surprises around tax time if the data is wrong/incomplete for example.
@Harveybirdman , could you please involve @pavla and myself in the discussions/meetings if there are any? If there are stalls ping us and we can reach out to Koinly as well
how I missed this important topic, yes, I used the Koinly, I really like it, I reach out for support DOT but didn’t work out, I have to write script and prepare all the DOT transactions by myself, would be glad to hear some updates
I’m not one of your developers, but as a user, I 100% agree with this post. I participated in Parachain auctions and believe in the projects. However, given the complications to my taxes, I just want to liquidate them. Even that is proving hard since I’m in the US. I’d much rather hold these tokens for another few years, but considering the tax risks, it isn’t worth it to me.
As a Koinly user, I don’t think they need too much. You could develop a whole API, but the simple approach is just to have a way for them to access the various chains to monitor the wallet addresses. They have this for the Polkadot relay chain, but they don’t have support for Acala, Astar, Clover, Enjin, etc.
I’m new to this forum and sadly lacking the knowledge of a developer. If this forum post is primarily about Polkadot (only), then that has some support on Koinly. The parachains are where things fall apart. I’ve tried the relay chain address for polkadot.js and the parachain wallet address, but Koinly won’t pick up anything by my DOT. If anyone has ideas on how to get them to support the parachains, maybe of us supporters would be grateful.
