Odaily Planet Daily News Industry experts said that Coinbase may face regulatory challenges in complying with the new US Financial Accounting Standards Board (FASB) accounting standards. It is reported that the standards will change the accounting and disclosure of cryptocurrencies from a low-cost impairment model to a fair value model. These rules were agreed by the FASB in 2023 and will officially take effect in 2025. However, relevant companies are allowed to adopt these standards early, and some companies, including Coinbase, have already followed this standard. The new standard aims to provide more accurate valuations of digital assets by obtaining the latest value of digital assets, rather than treating them as intangible assets, which has always been the standard practice. Olga Usvyatsky, former vice president of research at Audit Analytics, pointed out that while the new regulations provide investors with more useful decision-making information, it also brings volatility to corporate earnings. Companies often mitigate this volatility by using non-GAAP in financial reports. However, these cannot create individually customized indicators. Usvyatsky believes that Coinbase has done exactly this. Before adopting the new rules, Coinbase excluded cryptocurrency impairment costs from the adjusted EBITDA reconciliation. After adopting the rule, the company excluded fair value fluctuations, which Usvyatsky believes is also a tailored form of accounting because it ignores normal, recurring operating expenses. Coinbase separated its cryptocurrencies into four new items on its balance sheet: investments, operating purposes, borrowed cryptocurrencies, and loan collateral. These assets are accounted for at fair value, which is determined differently and affects the recorded gains or losses when the market value changes. The company also revised its definition of adjusted EBITDA to adjust for gains and losses on cryptocurrencies held for investment, arguing that these do not represent normal, recurring operating expenses required for its business. Usvyatsky said the SEC had previously questioned the company's non-GAAP adjustments, specifically sending letters to Bit Digital and MicroStrategy asking about similar impairment eliminations in financial reports. The SEC's follow-up letter to MicroStrategy in December 2021 asked the company to remove "the adjustment for the bitcoin impairment charge in the non-GAAP measure" in future filings.（CryptoSlate）