DeFi transactions data provided by MERLIN API P&L has been enhanced with a clear classification of the DeFi action which lays behind each transaction. MERLIN understands all DeFi strategies, and knows whether the wallets interact with other wallets or with Smart Contracts (DeFi protocols).
Accounting professionals providing digital asset accounting & tax services for individuals investing in cryptocurrencies and/or firms dealing with digital assets (treasury and/or investments), need to understand the raw on-chain transaction data from a DeFi activity perspective in order to build the proper financial reporting in compliance with the applicable jurisdiction.
Access to raw DeFi data is fairly easy, but understanding the kind of DeFi activity behind that raw data (farming, staking, LP deposits, …) often requires further processing & efforts, which is not the core of their business proposal. Which is where MERLIN comes in.
MERLIN’s understanding of all DeFi strategies and knowledge of all wallet’s interactions (with other wallets or smart contracts – DeFi protocols) has been translated into enhanced DeFi transaction classification, to provide the following additional information:
- the type of interaction (with wallet or smart contract),
- the type of movement (deposit, withdraw, send, receive, reward collection, liquidation, repay, …) – type of transaction,
- the type of DeFi action/investment (lending, liquidity pool, staking, farming, …),
- and to render the data exhaustive and transparent: the precise smart contract name and function (method)
Thanks to this MERLIN data, DeFi transactions can be pre-classified: save time and manual tasks to accounting professionals & end-users in the process of generating financial reports for accounting, audit, tax, … .
Based on the knowledge of their end-clients’ portfolio (wallets), accounting platform & service providers can finalize the reconciliation: the transactions classifications following the accounting/tax standards and the purpose of the financial reports to generate.
More technical insights here.
Check out MERLIN API and start your Free Trial now!