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Andrew Paszko

Simple Invest 360’s 1st Anniversary

By News, Simple Invest 360No Comments

On the 15th of June 2021 Simple Invest 360 was officially born into this world, a new member of the BGL family.

To say I was excited would be an understatement. Up until that point we had already spent 18 months writing specs, coding, testing, and working closely with our early beta Clients to ensure that what would be ultimately released on that day would be more than just ‘minimally viable’ and actually more like ‘acceptably on the right track’.

First of all, I would like to thank our clients who have shown not only keen interest but also provided valuable feedback in driving the development of Simple Invest 360 over the last 12 months. The words of support that we receive help to motivate the team and know that we are making a difference for our clients.

I would also like to acknowledge the entire Simple Fund 360 team, as I constantly remind myself that we are ‘standing on the shoulders of giants’ in being able to release a product with so many features so quickly. We have been able to leverage off the work/mistakes/learnings that the Simple Fund 360 team have already been through during their own journey.

And finally the team of superstars that I work with on a day-to-day basis: Yang, Mario, Nathan and Perera. Their willingness to put egos aside and work for the best outcome for our clients means that we have moved fast, and avoided breaking things (for the most part).

If you want to learn more about why our clients love using Simple Invest 360 for managing their investment Trusts, Companies and Individual Portfolios, please take the time to check out these case studies:

It is impossible not to save time using Simple Invest 360

How Simple Invest 360 was a ‘game changer’ for Lantana Private Wealth

And if you have FOMO and wish you could just get started right away, please feel free to reach out to find out what all the hype is about.

Book a Zoom meeting >>>

Thanks for all your support!

Andrew Paszko, Simple Invest 360 Product Manager

Cryptocurrency War Blog

How fighting against cryptocurrency is an unwinnable war

By BGL Update, TechnologyNo Comments

Despite the best efforts of financial regulators and threatened centralised institutions, the war on cryptocurrency seems to be unwinnable.

While cryptocurrencies may have come off the boil recently, there have been a few key events that have presented themselves that would imply they are not going to disappear completely from public view – and definitely not from investor portfolios.

Is it all a Ponzi scheme? Is it enabling criminal activity? Despite the best efforts of financial regulators and threatened centralised institutions, the war on cryptocurrency seems to be unwinnable.

In November 2021 the RBA’s head of payments, Tony Richards, was quoted in an AFR article with the usual concerns raised by institutions that are threatened by the decentralised finance movement. These were shots fired in a war against the perceived evil empire of cryptocurrency.

I too was a non-believer, silently snickering in early 2018 as Bitcoin lost almost half of its value. Since then I started small, and in more recent times there have been some key events that have made me double down on what I believe is a real area of opportunity.

Three stories that may change your mind about cryptocurrency

The CEO of Bitcoin

It must have been during a ‘snap reopening’ we had in Victoria in 2021, around August, when my daughter came home from school and told me that her friend’s mum was the CEO of Bitcoin. Wow, I thought, while Nakamoto Satoshi’s true identity is still up for debate, let’s have a look on Linkedin.

As tends to happen with news from the playground, there was some truth and some over-simplification. It turned out that the parent was a Financial Controller of a publicly listed payment and compliance company that specialised in digital assets.

Why was this significant to me? This was significant because this person had a family, a mortgage, bills to pay, and their livelihood was dependent on digital assets (cryptocurrencies) being the real deal.

Senator Jane Hume tells it how it is

During her address to the Australian Financial Review Super & Wealth Summit (Nov21), Jane Hume was direct and very clear about people who were either ignoring or trying to kill off innovation in decentralised finance – just don’t:

“Don’t be the person who thought the iPhone would never take off because people would prefer to have their music and telephone on separate devices. Don’t be the person who was still doing their financial models by hand in 2001, rather than using Excel.
Don’t be the person in 1995 who said the internet was just a place for geeks and criminals and would never become mainstream.
And don’t be the person who argued that email was a passing fad.”

~ Senator Jane HumeMinister for Women’s Economic Security, Minister for Superannuation, Financial Services and the Digital Economy.

This showed to me that at least some government officials get it and are willing to stand up for what they see as an inevitable area of innovation.

The great rotation

In December 2021 a New York Times article provided evidence of a rotation that was taking place in Silicon Valley. No longer were the prestigious roles at big tech companies such as Google, Amazon and Apple exciting or rewarding enough for the tech workforce.

The entrepreneurial spirit is real, and these visionaries were moving on to where they saw the biggest area of opportunity: blockchain technology:

“There is a giant sucking sound coming from crypto,” said Sridhar Ramaswamy, chief executive of search engine start-up Neeva and a former Google executive, who competes with crypto companies for talent. “It feels a bit like the 1990s and the birth of the internet all over again. It’s that early, that chaotic and that much full of opportunity.”

The keyword being ‘chaotic’ – with many aspects of the new world of decentralised finance (DeFi) and cryptocurrency resembling the wild west where anything goes and with great opportunity also comes great (calculated) risk.

Despite the risks, the percentage of Australians that own some form of cryptocurrency continues to increase and the industry itself locally is expanding.

Ultimately everyone needs to come to their own conclusions. Personally, I hope that we can consider the possibilities of what is new, and not just be scared by it due to it threatening ‘how things have always been done’ – after all, who among us would want to admit that we thought email was just a fad?

Trading Hobbyist: Accounting trap or goldmine?

By Homepage, In the Media, IndustryNo Comments

Trading Hobbyist: accounting trap or goldmine?

Never before has there been such a perfect storm leading to potentially either a goldmine or a nightmare for accountants. In this post, I will attempt to explain why accountants need to be prepared, how we got here and how you can turn a possible disaster into a goldmine for your firm.

It has been written and talked about ad nauseam – the world has changed. Ever since March 2020 we were told to go home: it’ll only be a few weeks and then we can all go back to normal. As weeks turned into months and the months into years and the situation spiralled out of control, many of us struggled with what to do with all this extra time we had on our hands. We were no longer distracted by social activities, ferrying kids around to various sports or being forced to go on holidays.

It was finally here. This was our chance. We were home when not eyeing people off suspiciously at the supermarket, or trying to hold in a cough at the chemist (just a dry throat, I swear). And then the storm hit. The formula looked something like this:

Increased time at home + technology at our fingertips + low brokerage fees = we could all be the Wolf of Wall Street.

Finally living the dream. Sitting around in pyjamas, a bowl of corn chips resting on our enlarged bellies, phone in one hand while keeping an eye on whatever it was Netflix told me everyone else was watching so why aren’t you. And within the phone the power to trade across time zones, across markets, derivatives, options, CFDs, crypto… Endless opportunities to make your millions, or quietly realise a loss that would never be spoken about.

This scenario may sound familiar or chances are you know someone that went down this path. Some people were just passing the time with a flutter, others legitimately trying to build wealth. Either way, we know that a lot of Australians did this.

According to SelfWealth’s (a flat fee retail share trading platform) Annual Report, active traders on their books increased by 105% during FY21 and the total number of trades increased by 147% for the same period¹. The reduced costs associated with working from home and lack of alternatives meant people had a surplus of cash and now that cash became seed capital for their own private hedge fund.

While the popularity of ETFs is growing, only 15% of investors choose this investment type compared to 58% of investors directly holding Australian shares (ASX, 2020)². A key area to watch is the number of investors dipping their toes (and sometimes up to their neck) in the ever-expanding galaxy of cryptocurrencies. According to the AFR, 1 in 5 Australians is likely to buy cryptocurrency in the next 12 months³.

We are now seeing investors using multiple brokers and exchanges to take advantage of sign up offers and referral programs. This may make sense for the investor looking to capture the highest return possible, but it does mean that they may end up with poor records and difficulty in tracking their investments.

Throw into the mix buybacks, stock splits, DRPs, demergers as well as the even more complex world of crypto yield farming and come tax time there will be either underreporting (non-compliance) or a heap of work for someone to reconcile the data and make sense of all the transactions.

While excel has been one of the greatest fintech solutions since Lotus 1-2-3, it does have limitations. Excel formulas can be error-prone, time must be invested for compliance changes and reconciliation back to any data source is limited or non-existent.

Luckily for today’s accountants there exists a whole new world of automation: an ecosystem of data feeds, AI and automated processing that will drastically reduce the amount of time required to keep track of CGT records, produce financials and arrive at a reliable tax optimised position.

The perfect storm has enabled trading and wealth creation for a whole new generation and now this generation needs your help to make sure they do not give it all back with poor tax planning and compliance issues.

References:

  1. SelfWealth Limited Annual Report (2021, June 30)  https://www.selfwealth.com.au/investor-centre/
  2. ASX Australian Investor Study (2020) https://www2.asx.com.au/blog/australian-investor-study
  3. AFR (2021, June 8) Four million Aussies set to buy into crypto https://www.afr.com/companies/financial-services/four-million-aussies-set-to-buy-into-crypto-20210608-p57z2g