{"id":66893,"date":"2023-12-13T16:59:49","date_gmt":"2023-12-13T20:59:49","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=66893"},"modified":"2023-12-13T17:02:50","modified_gmt":"2023-12-13T21:02:50","slug":"fasb-introduces-fair-value-crypto-accounting-standards","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/fasb-introduces-fair-value-crypto-accounting-standards\/","title":{"rendered":"FASB Introduces Fair-Value Crypto Accounting Standards"},"content":{"rendered":"\n

The first crypto accounting guidelines published by the Financial Accounting Standards Board<\/a> have completely changed the way businesses disclose their bitcoin holdings.<\/p>\n\n\n\n

\"FASB
FASB Introduces Fair-Value Crypto Accounting Standards<\/figcaption><\/figure>\n\n\n\n

Businesses that own Bitcoin (BTC) or Ethereum (ETH) are now required by these new regulations to value these assets using the fair value assessment method, which values them at their current market price.<\/p>\n\n\n\n

Due to the volatility of cryptocurrencies, corporations were previously only allowed to report the depreciated value of their crypto assets, which frequently resulted in lower earnings reporting. Businesses that have made significant investments in digital currencies<\/a> have taken issue with this biased strategy.<\/p>\n\n\n\n

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JUST IN: \ud83c\uddfa\ud83c\uddf8 #Bitcoin\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a> to be recorded at fair value under new FASB rules issued today – Bloomberg

\ud83d\udca5This is HUGE! pic.twitter.com\/47gUogsDul<\/use><\/svg><\/span><\/a><\/p>— Radar \ud835\ude38\u200b Archie\ud83d\udea8 (@RadarHits) December 13, 2023<\/use><\/svg><\/span><\/a><\/blockquote>

By enabling businesses to include both the highs and lows of their cryptocurrency holdings in their net income, the new regulations seek to give a more realistic and balanced picture of their financial health.<\/p>\n\n\n\n

The regulations are expected to go into force for fiscal years starting after December 15, 2024, however, both public and private businesses are allowed to adopt them earlier. Grayscale Investments CFO Edward McGee<\/use><\/svg><\/span><\/a> praised the update as a kind Christmas present from accounting. <\/p>\n\n\n\n

Before the Financial Accounting Standards Board's (FASB) ruling, non-investment businesses treated bitcoins as intangible assets by adhering to an AICPA practice guide. <\/p>\n\n\n\n

This meant that companies had to write down any declines in value permanently and could only declare gains upon selling the assets.<\/p>\n\n\n\n

David Marcus and Michael Saylor Address Decision<\/h2>\n\n\n\n

A prominent proponent of Bitcoin and MicroStrategy founder<\/a>, Michael Saylor tweeted his excitement with the FASB's ruling. He emphasized the choice as a crucial advancement in accounting standards.<\/p>\n\n\n\n

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FASB has officially adopted Fair Value Accounting for #Bitcoin\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a> for fiscal years beginning after Dec 15, 2024. This upgrade to accounting standards will facilitate the adoption of $BTC<\/use><\/svg><\/span><\/a> as a treasury reserve asset by corporations worldwide. https:\/\/t.co\/4GOuji6cr0<\/use><\/svg><\/span><\/a><\/p>— Michael Saylor (@saylor) December 13, 2023<\/use><\/svg><\/span><\/a><\/blockquote>

Saylor's words were echoed by former PayPal President David Marcus, who emphasized the significance of this shift. Marcus retweeted Saylor's post with a comment from Saylor, echoing her sentiments.<\/p>\n\n\n\n

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You may think this is a small accounting change that doesn\u2019t mean much. It\u2019s actually a big deal. This removes a large obstacle standing in the way of corporations holding #Bitcoin\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a> on their balance sheet. 2024 will be a landmark year for $BTC<\/use><\/svg><\/span><\/a>. https:\/\/t.co\/gV0KRISt8B<\/use><\/svg><\/span><\/a><\/p>— David Marcus (@davidmarcus) December 13, 2023<\/use><\/svg><\/span><\/a><\/blockquote>

The first crypto accounting guidelines published by the Financial Accounting Standards Board have completely changed the way businesses disclose their bitcoin holdings. Businesses that own Bitcoin (BTC) or Ethereum (ETH) are now required by these new regulations to value these assets using the fair value assessment method, which values them at their current market price. […]<\/p>\n","protected":false},"author":43,"featured_media":66895,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[17570,11779],"class_list":["post-66893","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-crypto-accounting-standards","tag-fasb"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2023\/12\/croc_1702499517287.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/66893","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/43"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=66893"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/66893\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/66895"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=66893"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=66893"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=66893"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}