The Financial Accounting Standards Board on Wednesday said companies should use fair-value accounting for measuring bitcoin and other crypto assets, moving a step closer to a standard that could clear up uncertainty over reporting how much such holdings are worth.
There are currently no specific accounting or disclosure rules for cryptocurrency assets, so businesses classify them as indefinite-lived intangible assets similar to intellectual property such as trademarks. Companies must review the value of such assets at least once a year and write it down if it drops below the purchase price. If the value rises, companies can only record a gain when they sell the asset, not if they continue holding it.
Companies and accountants want the FASB to adopt fair-value accounting instead, which would allow them to recognize losses and gains immediately and treat digital assets as financial assets.
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