Michael Saylor welcomes FASB vote to review crypto accounting standards
Bitcoin proponent and MicroStrategy CEO Michael Saylor has welcomed the U.S. Financial Accounting Standards Board (FASB) vote to review accounting rules for digital assets and commodities.
As it stands under current FASB guidelines — which is the source of authoritative Generally Accepted Accounting Principles (GAAP) — companies must report digital assets such as BTC as “intangible assets” on their balance sheets.
This is due to crypto not meeting the agreed definition of “cash and cash equivalents, financial instruments, financial assets, and inventory” amongst the agency.
As crypto is deemed as an intangible asset, companies are required to measure the assets at their lowest price during a given reporting period, which often results in “impairment losses” on balance sheets even if the firm hasn’t closed its position.
The FASB held a meeting to vote on the crypto accounting review earlier today, and while it is yet to publish the results via its website, it appears that Saylor was watching the live stream as he reported the vote went through 7-0 and stated “congratulations to the Bitcoin community.”
Congratulations to the #Bitcoin community. This morning, by unanimous vote of 7-0, the Financial Accounting Standards Board (FASB) agreed to add a project to review Accounting for Exchange-Traded Digital Assets and Commodities.
“This is amazing. One step closer to making it easier for corporates to own Bitcoin on their balance sheet and account for it in a cogent manner,” responded Kraken’s Director of Growth Marketing Dan Held.
While it is unclear when the review will take place, or what the outcome could be, a shift to a definition resembling anything in the ballpark of “traditional financial assets” would make it a lot
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