The Financial Accounting Standards Board (FASB) in the U.S. officially implemented accounting standards specifically for cryptocurrencies on the 15th of this month. According to these new rules, in the future, U.S. companies holding cryptocurrencies will be able to account for their digital assets like Bitcoin at market fair value in their financial reports.
What changes have occurred after the first cryptocurrency accounting standards were implemented?
Previously, the U.S. government did not establish specific accounting standards for cryptocurrencies to guide companies holding cryptocurrencies on how to record and measure their holdings on their balance sheets. Therefore, in general, these companies could only classify cryptocurrencies as intangible assets, which meant that when registering, they could only calculate the cost based on the 'purchase price'.
At the same time, for these companies, if the price of the cryptocurrencies held on their balance sheets falls, they can only perform impairment; they can only register assets profitably when they decide to sell the cryptocurrencies.
MicroStrategy, the publicly traded company with the largest amount of Bitcoin holdings in the world, once complained to the U.S. Securities and Exchange Commission (SEC) that such accounting standards are not good for companies and investors, as the accounting standards that only allow for impairment do not allow the board and investors to comprehensively assess cryptocurrency investments in financial reports.
However, now with the new accounting standards in place, companies can begin to separately record the cryptocurrencies they hold on their balance sheets by classifying them as special projects, and if calculated at fair value, these companies can also include the profits brought by the rise in cryptocurrency prices in their net income. This allows companies investing in Bitcoin or Ethereum, such as MicroStrategy, to present their cryptocurrency investment income in their financial reports more accurately.
Bitcoin breaks through $107,000 to set a new high
After Bitcoin reached a historic high of $106,660 on the 16th, it surged again today (17th) at 0:30 AM, with BTC peaking at $107,796, setting a new all-time high. As of this writing, there has been a slight pullback to $106,020, with a 24-hour increase of 0.51%.
