According to a news report, the Financial Accounting Standards Board (FASB) has stated that businesses should utilize fair-value accounting techniques for cryptocurrencies like bitcoin (BTC) and ether (ETH).
Companies would be able to report losses and gains instantly and handle the asset class as conventional financial assets if they used fair-value accounting for cryptocurrencies. Digital assets are now regarded as intangible, indefinite-lived assets that only need to be reported once a year.
Following pressure from individuals like former MicroStrategy (MSTR) CEO Michael Saylor, who said that present regulations dissuade businesses from storing bitcoin on their balance sheets, the FASB unanimously decided to evaluate the accounting standards for cryptocurrencies in May. Saylor tweeted his support for the new accounting method and described it as a significant step toward the institutional use of bitcoin.
With a position worth $2.47 billion and an unrealized loss of $1.51 billion, MicroStrategy now holds 130,000 bitcoin. In a letter to the FASB last year, MicroStrategy CEO Phong Le stated that they anticipate the gap between the reported carrying value on their balance sheet and the fair market value of their bitcoin holdings to widen over time.