Ledger capitalises on the Bitcoin boom with support from Avalara

Have you ever wondered where people store their Bitcoin? Many of them use Ledger’s state-of-the art hardware wallets. Growing demand for cryptocurrencies – fuelled by globalisation and loss of trust in traditional financial institutions – has seen sales of Ledger’s proprietary technology soar since the company launched in 2014.

Today the France-based tech company serves customers in more than 165 countries and its most popular hardware wallet, the Nano, has sold over three million units. For business customers, Ledger has created Vault: a SaaS solution to safeguard large amounts of multiple types of crypto assets.

When Blanche Savary de Beauregard - Head of M&A, Tax and Customs - joined Ledger in 2018, she immediately realised that its ambitious growth plans meant she would need support. With a team of just one, keeping up with the increasingly complex tax requirements in so many different jurisdictions would be unmanageable.

That year, the Wayfair ruling came into force in the US, which meant Ledger needed to register in several states and abide by each one’s unique rules and regulations. Blanche knew that dealing with VAT registration and reporting across Europe was relatively straightforward compared with the US system, a myriad of more than 14,000 constantly fluctuating tax jurisdictions.

She says, “Although European countries are not completely aligned, there are at least similarities between countries. The US has definitely been the most challenging market. Because we use Amazon for some of our fulfilment, local inventory held by Amazon meant we needed to register in places we hadn’t realised. It would have been completely nightmarish to try to manage this without Avalara.”

Avalara was chosen to provide Ledger with a complete compliance solution, which includes managing registration and reporting for VAT and sales tax globally. Ledger currently files tax returns across the EU, in all 50 US states, and in Japan and Australia. Partnership with Avalara has allowed a relatively small tax team to meet the compliance requirements created by the rapid growth of global sales.

Blanche says: “This couldn’t have been done without Avalara. Its automation and expertise saves a huge amount of time and money compared with having to find lawyers and local representatives to complete VAT registrations in all our jurisdictions.”

Ledger has an ecommerce website managed through third-party ecommerce providers, and has its own bespoke back-office system, implementing in particular certain tax rules. 

For European sales, extracts of Ledger’s back-office are uploaded to Avalara’s systems. In the US, the website integrates directly with Avalara’s AvaTax. Being able to mix and match integrations like this has been a huge advantage.

Demand for crypto technologies boomed during the COVID-19 pandemic. This was due to investors looking to diversify their investment portfolios, and crypto being seen as a safer option as traditional markets and indeed currencies were being negatively impacted by the pandemic.

Sales of Ledger’s products increased and the company benefited from the fact that their supply chain for the production of Nano was based entirely in France, and therefore largely unaffected by lockdowns. Its main challenges were logistical, with outbound shipping impacted by several countries introducing import restrictions due to the pandemic.

But luckily, one thing Ledger didn’t have to worry about was tax compliance, thanks to its partnership with Avalara.