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Accounting Board to look at Digital Assets


The Board unanimously decided to add a project to its technical agenda that will address the recognition, measurement, presentation, and disclosure of certain digital assets in the financial statements.

The project is expected to focus on whether to require or permit ongoing fair value measurement for digital assets with specified characteristics.


Why is this important?

There is no specific reference to BTC or digital assets under the current accounting measure, so these assets fall into the bucket of “intangible assets”. In other words, these assets fall into the murky valuation of non-physical assets like intellectual property and branding.


What does that look like?

Accounting for BTC is put on the books at the purchase price which is obvious. However, if BTC goes below the purchase price the company must write down the value as an impairment charge. If the price goes higher, the value remains at the purchase price and only can log any gains when they sell and create a taxable event.

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