Bitcoin graphic illustration

FASB Seeking Comments on Proposed Amendments Regarding Digital Assets

The Financial Accounting Standards Board (FASB) is seeking comments by Tuesday, June 6 on its newly proposed Accounting Standards Update (ASU).

With the world of digital assets moving at lightning speed, the FASB’s proposed amendments are part of its ongoing efforts to update accounting standards for, and disclosure of, certain digital assets.


The FASB, established in 1973, is an independent, private-sector, not-for-profit organization that establishes financial accounting and reporting standards for public and private companies and not-for-profit organizations that follow Generally Accepted Accounting Principles (“GAAP”).

The FASB is recognized by the U.S. Securities and Exchange Commission as the designated accounting standard setter for public companies. FASB standards are recognized as authoritative by many other organizations, including state Boards of Accountancy and the American Institute of CPAs (AICPA). The FASB develops and issues financial accounting standards through a transparent and inclusive process intended to promote financial reporting that provides useful information to investors and others who use financial reports.

The Financial Accounting Foundation (FAF) supports and oversees the FASB. Established in 1972, the FAF is the independent, private-sector, not-for- profit organization based in Norwalk, Conn., responsible for the oversight, administration, financing, and appointment of the FASB and the Governmental Accounting Standards Board (GASB).


As per the March 23 announcement, the proposed amendments would enhance the information provided to investors about an entity’s crypto asset holdings by requiring disclosure about significant holdings, changes and/or restrictions in said holdings. Additionally, the proposed amendments would upgrade the accounting standards for certain crypto assets by mandating an entity to measure the assets at fair value each reporting period with changes in fair value recognized in net income.

The announcement states “[i]n addition, fair value measurement would align the accounting required for all holders of crypto assets with the accounting for entities that are subject to certain industry-specific guidance (such as investment companies) and eliminate the requirement to separately test those assets for impairment, thereby reducing the associated cost and complexity of applying the current guidance.”

The amendments in this proposed ASU would be applicable to all entities holding crypto assets that meet all the following criteria:

  • Meet the definition of intangible asset as defined in the FASB Accounting Standards Codification Master Glossary 1;
  • Do not provide the asset holder with enforceable rights to, or claims on, underlying goods, services, or other assets;
  • Are created or reside on a distributed ledger based on blockchain technology;
  • Are secured through cryptography;
  • Are fungible; and
  • Are not created or issued by the reporting entity or its related parties.


As stated above, the FASB is looking for comments by June 6, and posed questions to stakeholders in the announcement. Initially it seems these proposals may increase transparency and help consumer protection which is a step in the right direction. Importantly, the public should review the proposed amendments and make comments if they have concerns.

It’s reasonable to assume that no matter what the comments say, accountants, just like most other business professionals, must think about how these digital-asset updates impact the applicable standards of care and duties owed to clients.

1 Intangible Assets are defined as “Assets (not including financial assets) that lack physical substance. (The term intangible assets is used to refer to intangible assets other than goodwill.)”