LibraTax CEO Jake Benson recently gave a keynote at SXSW Interactive that was so well-received presentation it drew the attention of Barron's.

1. How Bitcoin Will
Disrupt Accounting
and Audit
Jake Benson
CEO/Founder of Libra

2. About Me
2

3. Summary
• History of Accounting
• Bitcoin is Accounting Technology
• Accounting and Audit Impact
• Beyond Currency
3
1000s of years ago
100s of years ago
10s of years ago
The simplest explanation of bitcoin
you’ve ever heard
Bookkeeping and taxes don’t have to
be so painful
Record keeping meets the internet
of things

4. Accounting Came Before Language
• Pre-numerical counting
systems pre-dated even
written language, more
than 7,000 years ago
• The invention of a form
of bookkeeping using
clay tokens represented
a huge cognitive leap
for mankind.
4
It even came before numbers themselves

5. Credits and Debits
The most important event in accounting history is
generally considered to be the dissemination of
double-entry bookkeeping by Luca Pacioli in 14th
century Italy.
5
The basic principles we use today were invented 700 years ago

6. First World Problems
• Sarbanes-Oxley Act of
2002, passed after the
Enron and WorldComm
accounting scandals.
• The 21st century also saw
the passage of the Dodd-
Frank Act after the
recession of 2008.
6
Accounting has been outpaced by financial innovation

7. What is the ‘Blockchain’?
7
Debit Credit
1GwM6Hi2k7BQs2qzg2
8adftbSk5UirVJN2 5 5
1Jr8utBdg25dxUEMrW
DrTjgSCjKckJMjwS
12Smcj8xtaaXTNnLh68j
oFqC2Y9FwXj84B 307 307
17b5J4b66bzmHA1inw
4LsVRcPVYkCKPP84
17b5J4b66bzmHA1inw
4LsVRcPVYkCKPP84 0.0287639 0.0287639
13DakNcnm4WXoYBun
Tdo3X2YE8gzfE9uV
1L8fi8McFaPu2yj1Sw3c
yqs1hDUmgkah2T 20.5 20.5
1NKaaq3q7yuVnactsMf
XT2b9hv2rwWnjPp
It’s just a ledger

8. What is a Bitcoin?
8
They actually don’t exist - it’s just a balance
5Kb8kLf9zgWQnogid
DA76MzPL6TsZZY36h
WXMssSzNydYXYB9KF
+

9. Why it works
9
Every single transaction is audited and copied millions of times

10. Anatomy of a Transaction
10
A message: subtract an amount from account A and add to account B

11. Accounting Implications
11
How does this lead to a better future?

12. 12
Blockchain
Public
Meta
Data
Personal Private
Data
Tax Data

13. 13

14. Public Meta Data
14
‘Twitter’ API for finance - realtime global insights in spending
#Movie Ticket
#Home Improvement
#Grocery
#Auto Repair
What if we could query economic activity like we
could query communication?

15. Triple Entry Accounting
15
Self-auditing books - it’s tough to lie when everyone is watching
Debit Credit
5
2
9
10
Debit Credit
5
2
9
10
Alice Bob
-5 5
2 -2
9 -9
-10 10
Alice’s Books Bob’s Books
Public Book

16. Beyond Currency
16
What else can be exchanged this way?
Debit Credit
1GwM6Hi2k7BQs
2qzg28adftbSk5Ui
rVJN2
5,000 USD
‘IOU’ in Bank
5 BTC
‘IOU’ in Coinbase
1Jr8utBdg25dxUE
MrWDrTjgSCjKck
JMjwS
Debit Credit
1GwM6Hi2k7BQs
2qzg28adftbSk5Ui
rVJN2
Share of Tesla Stock $190
1Jr8utBdg25dxUE
MrWDrTjgSCjKck
JMjwS
Debts
Shares
Debit Credit
1GwM6Hi2k7BQs
2qzg28adftbSk5Ui
rVJN2
Criteria X Met Contract Execution
1Jr8utBdg25dxUE
MrWDrTjgSCjKck
JMjwS
Contracts

17. The Future
Accountants and Auditors are financial Doctors.
We’ve just given them penicillin.
17