The Financial Accounting Standards Board (FASB), the organization that sets accounting standards in the US, is reportedly green-lighting new rules for measuring the value of crypto assets on a company’s balance sheet.
According to Bloomberg, the FASB on Wednesday voted unanimously in favor of new rules requiring companies that own or invest significant amounts of Bitcoin (BTC), Ethereum (ETH) and other cryptocurrencies to report their holdings at fair value.
The goal is to provide an updated and more accurate measure of the asset’s value.
Under the new rules, companies must make a separate entry on their balance sheet for their crypto assets.
They must also disclose their significant holdings of crypto, the restrictions on these assets, and information on the reconciliation activity of crypto assets received as payment and immediately converted to cash.
The crypto-assets covered by the rules must also be fungible or interchangeable with other assets, meaning non-fungible tokens such as NFTs are excluded. The rules do not cover stablecoins or wrapped tokens.
The new set of accounting rules will be mandatory for both public and private companies for fiscal years beginning after December 15, 2024, and will cover interim periods within those years. However, companies will be allowed to apply the rules early once the FASB publishes them this year.
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