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Bitcoin (BTC)\u00a0and crypto may soon see another mass wave of adoption by U.S.-based firms, after a new accounting rule change that lets companies more accurately reflect the value of their crypto holdings.\u00a0<\/p>\n
Cory Klippsten, the CEO of Bitcoin-only exchange Swan Bitcoin, told Cointelegraph that Bitcoin-holding companies like MicroStrategy and Tesla, which both had to report impairment on their holdings, \u201ccan now more accurately reflect their Bitcoin investments\u2019 true value.\u201d<\/p>\n
\u201cThis change is crucial for a broad range of companies, not just those primarily focused on Bitcoin, encouraging more mainstream corporate adoption.\u201d<\/p><\/blockquote>\n
The new Financial Accounting Standards Board (FASB) rules released on Dec. 13 that come into effect on December 2024 see the estimated market value of crypto held by companies represented accurately on companies\u2019 accounting books by allowing them to record when they\u2019re holding assets at a gain.<\/p>\n
Previously, crypto held by companies was subject to impairment only with the value of crypto decreased on the books which could not be increased until sold, even if its value increased while being held.<\/p>\n
Klippsten added that companies could now use Bitcoin as a \u201cstrategic financial asset\u201d as they would be able to report on their value gains and losses, a feature that could help drive adoption.<\/p>\n
Matrixport research head and Crypto Titans<\/em> author Markus Thielen told Cointelegraph that the rule change \u201cunderscores the palpable corporate demand\u201d for incorporating crypto into a firm\u2019s accounting. <\/p>\n
Related: <\/em><\/strong>BlackRock revises spot Bitcoin ETF to enable easier access for banks<\/em><\/strong><\/p>\n
\u201cDigital assets are increasingly becoming a crucial component of financial statements,\u201d said Thielen, adding that companies will now have more confidence when valuing their crypto holdings.<\/p>\n
\u201cThis signals a resounding confirmation that digital assets have firmly established themselves in the financial landscape.\u201d<\/p><\/blockquote>\n
Others were also excited by the rule change. David Marcus, co-creator of Facebook\u2019s binned stablecoin project Diem, posted to X (Twitter) on Dec. 13 that the new rules are \u201cactually a big deal\u201d which remove \u201ca large obstacle standing in the way of corporations holding Bitcoin on their balance sheet.\u201d<\/p>\n
\nYou may think this is a small accounting change that doesn\u2019t mean much. It\u2019s actually a big deal. This removes a large obstacle standing in the way of corporations holding #Bitcoin<\/a> on their balance sheet. 2024 will be a landmark year for $BTC<\/a>. https:\/\/t.co\/gV0KRISt8B<\/p>\n