BitPay CFO: Crypto Challenges Create Lessons For All Industries

Chief financial officers (CFOs) have been met with unfamiliar obstacles over the last year, testing their ability to remain reactive and agile amid the volatility.

Despite the challenges, the market environment created the opportunity for CFOs to emerge as invaluable, strategic leaders within their enterprises — not only taking the lead on digital transformations, but on driving growth for the organizations.

Many CFOs encountered the same challenges and opportunities, regardless of industry, business size or location. Yet for BitPay CFO Jagruti Solanki, some of the most complex areas of friction in the back office cannot merely be solved by getting rid of paper (although it helps). Due to the nature of the cryptocurrency market, Solanki said she has the added burden of not only navigating BitPay through an evolving and relatively young industry, but also helping to steer that evolution for the industry overall.

Speaking with PYMNTS’ Karen Webster, she described some of the most pressing hurdles of managing finances and leading modernization for a crypto technology firm, and how some of the lessons she’s learned within the bitcoin space are proving valuable for CFOs of all kinds.

Uncharted Territory

Like many firms hit with sudden remote working requirements, Solanki said BitPay had a bit of adjusting to do when the pandemic first emerged. That included some of the most common and pressing digitization initiatives, like getting rid of paper and migrating away from checks.

Even a digital-native company like BitPay had been paying some vendors in checks, she noted, but quickly shifted its accounts payable (AP) department toward ACH as the team worked from home.

But there are other complications of modernizing the financial back office that stem from BitPay’s position within the cryptocurrency arena. A lack of crypto-related accounting standards has created one of the largest question marks for finance leaders whose organizations operate with crypto today.

“That’s one of the things that makes it a challenge, especially in my role, to figure out how we account for all of this information,” said Solanki. “Regulatory bodies, and accounting standard-setting bodies, are all still kind of catching up with the pace at which the industry is evolving — and it’s evolving really fast.”

As a CFO in this industry, Solanki said she faces a particularly high burden to keep tabs on that evolution and understand the ever-changing guidelines for the sector.

Cryptocurrency also forces CFOs to develop more advanced risk mitigation strategies. Solanki emphasized the importance of tracking key performance indicators (KPIs) to make decisions using real-time data.

“Given the volatility, we cannot be reactive to something that is happening,” she said. “We almost have to predict, to an extent, what the impact is going to be.”

Teach And Learn

With ongoing compliance and real-time market analytics emerging as vital tools for a crypto CFO, it’s perhaps unsurprising that digitization initiatives like data integration and real-time reporting are top priorities for Solanki.

But beyond internal digitization initiatives, the role of CFO has evolved into a position of leadership not only within the organization, but also within the crypto industry. The factors that make this sector so complex for finance leaders — including a lack of accounting standardization and ongoing volatility — are the same ones that create an opportunity for finance leaders to come together and collaborate on how best to operate in this space.

As such, Solanki said it’s imperative for CFOs in this market to be educated supporters of the technology. Understanding cryptocurrency and blockchain is essential to ensuring that the financial goals of the enterprise can support the broader goals of the business on areas like product development and customer success.

“I cannot do my role, and I cannot be a good financial officer, if I don’t believe in this space or don’t understand what’s going on with our products or operations,” noted Solanki.

Collaboration is another key principle for Solanki as a finance leader in the crypto space. Understanding and believing in cryptocurrency, she said, allows her to support company-wide objectives across the product development, engineering and other teams, for instance. And at the industry-wide level, working alongside other stakeholders and regulators similarly breeds a spirit of cooperation necessary to move the entire sector forward.

But while values of collaboration, leadership, agility and innovation may have their roots in the unique challenges of the crypto space, those principles prove useful for finance leaders everywhere.

“I personally believe in keeping a broad mind and being very receptive to the innovation and changes that can disrupt the way you do things,” said Solanki, adding that “we teach, and we learn, and we grow with each other.”