Crypto companies and institutions holding crypto assets in the United States will soon be able to record the value of their assets more accurately, thanks to new accounting rules set by the Financial Accounting Standards Board (FASB). Currently, crypto assets are considered indefinite-lived intangible assets and are subject to impairment. This means that if the value of the assets decreases, it is reflected in the books, but any increase in value cannot be recorded until the assets are sold. This can be problematic in the volatile crypto market, as it may make a company’s assets appear to be worth less than their actual market value.

Under the updated accounting standards, the fair value of crypto assets will be measured in each accounting period and represented in companies’ books. This change is expected to provide more relevant information and reduce accounting costs and complexity. The FASB finalized the new rules after a consideration process that began last year, with a call for comments in March and a vote on the changes in September. The updated rules will take effect in fiscal years beginning after December 15, 2024.

This development is significant for the adoption of Bitcoin as a treasury reserve asset by corporations worldwide. It is expected to facilitate the integration of Bitcoin into corporate financial strategies. The FASB’s decision to adopt fair value accounting for Bitcoin is seen as a positive step towards recognizing the underlying economics of crypto assets and providing a more accurate representation of a company’s financial position.

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Information	Details
Geography	North America
Countries	🇺🇸
Sentiment	positive
Relevance Score	1
People	Michael Saylor, James Lavish
Companies	Financial Accounting Standards Board (FASB)
Currencies	Bitcoin
Securities	None