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FASB releases exposure draft for cryptocurrency standards

Written on Mar 30, 2023

FASB has published a proposed Accounting Standards Update (ASU) intended to improve the accounting for and disclosure of certain crypto assets.  

The FASB heard feedback that the accounting for crypto assets as indefinite-lived intangible assets, which is a cost-less-impairment model, does not provide investors with decision-useful information or reflect the underlying economics of those assets. 

The amendments in this proposed ASU would improve the accounting for certain crypto assets by requiring an entity to measure those crypto assets at fair value each reporting period with changes in fair value recognized in net income. The proposed amendments also would improve the information provided to investors about an entity’s crypto asset holdings by requiring disclosure about significant holdings, restrictions, and changes in those holdings. 

The amendments in this proposed ASU would apply to all entities holding crypto assets that meet all the following criteria: 

  • Meet the definition of intangible asset as defined in the FASB Accounting Standards Codification Master Glossary 

  • Do not provide the asset holder with enforceable rights to, or claims on, underlying goods, services, or other assets 

  • Are created or reside on a distributed ledger based on blockchain technology 

  • Are secured through cryptography 

  • Are fungible 

  • Are not created or issued by the reporting entity or its related parties. 

Stakeholders are encouraged to review and provide input on the proposed ASU by June 6, 2023.