BTC-Newswire

Crypto Accounting Reform: US Regulations Expected By Year-End

Press Releases Crypto News Bitcoinist Crypto Accounting Reform: US Regulations Expected By Year-End

Crypto accounting is undergoing a seismic shift in the United States as the Financial Accounting Standards Board (FASB) unanimously approves new rules governing the fair valuation of companies’ cryptocurrency holdings, according to recent reports.

The move, widely anticipated and applauded by the financial industry, aims to bring transparency and consistency to a rapidly evolving sector. These new accounting standards are set to take effect in 2025, marking a significant shift in how companies handle their digital assets.

Fair Value Accounting For Cryptocurrency: A Game-Changer?

The FASB, the governing body responsible for setting accounting and reporting standards under US Generally Accepted Accounting Principles (GAAP), initiated the process by seeking public input on proposed changes to the FASB Accounting Standards Codification in March.

Subsequently, board members reached a unanimous consensus, approving a standard that mandates the use of fair value accounting for bitcoin and select other crypto assets. This approach ensures that companies reflect the true market value of their digital currency holdings, irrespective of recent price fluctuations—a change welcomed by many stakeholders.

Companies, both public and private, will now be obliged to separately disclose their cryptocurrency assets in their financial reports, whether on a quarterly or annual basis.

Total crypto market cap still pegge at $1.12 trillion on the daily chart: TradingView.com

While this new accounting method is expected to introduce increased earnings volatility for companies with substantial holdings, it also allows them to recognize financial gains stemming from rising prices. Notably, companies can opt to implement fair-value accounting for their crypto assets immediately if they so desire.

FASB member Christine Botosan emphasized the benefits of

Go to Source to See Full Article
Author: Christian Encila

Did you like this?
Tip BTC Newswire with Cryptocurrency