Asu 2023-08

No.
2023-08
December 2023
Intangibles—Goodwill and Other—

Crypto Assets (Subtopic 350-60)
Accounting for and Disclosure of Crypto Assets
An Amendment of the FASB Accounting Standards Codification®

The FASB Accounting Standards Codification® is the source of authoritative generally
accepted accounting principles (GAAP) recognized by the FASB to be applied by
nongovernmental entities. An Accounting Standards Update is not authoritative; rather, it is a
document that communicates how the Accounting Standards Codification is being amended.
It also provides other information to help a user of GAAP understand how and why GAAP is
changing and when the changes will be effective.
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Accounting Standards Update
No. 2023-08
December 2023
Intangibles—Goodwill and Other—

Crypto Assets (Subtopic 350-60)
An Amendment of the FASB Accounting Standards Codification®
Financial Accounting Standards Board

801 Main Avenue・Norwalk, CT・06851
Accounting Standards Update 2023-08
Intangibles—Goodwill and Other—Crypto Assets

(Subtopic 350-60)
December 2023
CONTENTS
Page
Numbers
Summary ............................................................................................ 1–4

Amendments to the FASB Accounting Standards Codification® ...... 5–21
Background Information and Basis for Conclusions ....................... 22–46
Amendments to the GAAP Taxonomy .................................................. 47
Summary
Why Is the FASB Issuing This Accounting Standards

Update (Update)?
The Board is issuing the amendments in this Update to improve the accounting
for and disclosure of crypto assets. Stakeholder feedback, including from
respondents to the 2021 FASB Invitation to Comment (ITC), Agenda
Consultation, indicated that improving the accounting for and disclosure of
crypto assets should be a top priority for the Board. Stakeholders stated that
the current accounting—except as provided in generally accepted accounting
principles (GAAP) for certain specialized industries—for holdings of crypto
assets as indefinite-lived intangible assets, which is a cost-less-impairment
accounting model, does not provide investors, lenders, creditors, and other
allocators of capital (collectively, “investors”) with decision-useful information.
Specifically, accounting for only the decreases, but not the increases, in the
value of crypto assets in the financial statements until they are sold does not
provide relevant information that reflects (1) the underlying economics of those
assets and (2) an entity’s financial position. Investors also requested additional
disclosures about the types of crypto assets held by entities and the changes
in those holdings.
In addition to better reflecting the economics of crypto assets, measuring those

assets at fair value will likely reduce cost and complexity associated with
applying the current cost-less-impairment accounting model for many entities.
Who Is Affected by the Amendments in This Update?

The amendments in this Update apply to all entities holding assets that meet
certain scope criteria.
What Are the Main Provisions?

The amendments in this Update apply to assets that meet all of the following
criteria:
1
1. Meet the definition of intangible assets as defined in the Codification
2. Do not provide the asset holder with enforceable rights to or claims on
underlying goods, services, or other assets
3. Are created or reside on a distributed ledger based on blockchain or
similar technology
4. Are secured through cryptography
5. Are fungible
6. Are not created or issued by the reporting entity or its related parties.
An entity is required to subsequently measure assets that meet those criteria

at fair value with changes recognized in net income each reporting period.
The amendments in this Update also require that an entity present (1) crypto
assets measured at fair value separately from other intangible assets in the
balance sheet and (2) changes from the remeasurement of crypto assets
separately from changes in the carrying amounts of other intangible assets in
the income statement (or statement of activities for not-for-profit entities).
While the amendments in this Update do not otherwise change the

presentation requirements for the statement of cash flows, the amendments
require specific presentation of cash receipts arising from crypto assets that
are received as noncash consideration in the ordinary course of business (or
as a contribution, in the case of a not-for-profit entity) and are converted nearly
immediately into cash.
For annual and interim reporting periods, the amendments in this Update
require that an entity, including an entity that is subject to industry-specific
guidance, disclose the following information:
1. The name, cost basis, fair value, and number of units for each significant
crypto asset holding and the aggregate fair values and cost bases of the
crypto asset holdings that are not individually significant
2. For crypto assets that are subject to contractual sale restrictions, the fair
value of those crypto assets, the nature and remaining duration of the
restriction(s), and the circumstances that could cause the restriction(s)
to lapse.
2
For annual reporting periods, the amendments in this Update require that an
entity disclose the following information:
1. A rollforward, in the aggregate, of activity in the reporting period for
crypto asset holdings, including additions (with a description of the
activities that resulted in the additions), dispositions, gains, and losses
2. For any dispositions of crypto assets in the reporting period, the
difference between the disposal price and the cost basis and a
description of the activities that resulted in the dispositions
3. If gains and losses are not presented separately, the income statement
line item in which those gains and losses are recognized
4. The method for determining the cost basis of crypto assets.
How Do the Main Provisions Differ from Current

Generally Accepted Accounting Principles (GAAP) and
Why Are They an Improvement?
Under current GAAP, unless otherwise provided in industry-specific GAAP,
crypto assets that are within the scope of the amendments in this Update are
accounted for as indefinite-lived intangible assets. Those assets are tested for
impairment annually and more frequently if events or circumstances indicate
that it is more likely than not that an asset is impaired. If the carrying amount
of the asset exceeds its fair value, an entity is required to recognize an
impairment loss and reduce the carrying amount of the asset to its fair value.
Subsequent increases in the carrying amount of the asset and reversal of an
impairment loss are prohibited.
The amendments in this Update require that an entity measure crypto assets
at fair value in the statement of financial position each reporting period and
recognize changes from remeasurement in net income. The amendments also
require that an entity provide enhanced disclosures for both annual and interim
reporting periods to provide investors with relevant information to analyze and
assess the exposure and risk of significant individual crypto asset holdings.
In addition, fair value measurement aligns the accounting required for holders
of crypto assets with the accounting for entities that are subject to certain
industry-specific guidance (such as investment companies) and eliminates the
3
requirement to test those assets for impairment, thereby reducing the
associated cost and complexity of applying the current guidance.
When Will the Amendments Be Effective and What

Are the Transition Requirements?
The amendments in this Update are effective for all entities for fiscal years
beginning after December 15, 2024, including interim periods within those fiscal
years. Early adoption is permitted for both interim and annual financial
statements that have not yet been issued (or made available for issuance). If
an entity adopts the amendments in an interim period, it must adopt them as of
the beginning of the fiscal year that includes that interim period.
The amendments in this Update require a cumulative-effect adjustment to the

opening balance of retained earnings (or other appropriate components of
equity or net assets) as of the beginning of the annual reporting period in which
an entity adopts the amendments.
4
Amendments to the
FASB Accounting Standards Codification®
Introduction
1. The Accounting Standards Codification is amended as described in
paragraphs 2–13. Terms from the Master Glossary are in bold type. Added
text is underlined, and deleted text is struck out.
Addition of Subtopic 350-60

2. Add Subtopic 350-60, with a link to transition paragraph 350-60-65-1, as
follows:
[For ease of readability, the new Subtopic is not underlined.]
Intangibles—Goodwill and Other—Crypto Assets
Overview and Background
General
350-60-05-1 This Subtopic provides guidance on the subsequent

measurement, presentation, and disclosure of crypto assets that are within the
scope of this Subtopic.
350-60-05-2 This Subtopic does not address the initial measurement,

recognition, and derecognition of crypto assets. Reporting entities shall
account for the initial measurement, recognition, and derecognition of crypto
assets in accordance with other generally accepted accounting principles
(GAAP).
Scope and Scope Exceptions
General
> Overall Guidance
5
350-60-15-1 The guidance in this Subtopic applies to holdings of assets that
meet all of the following criteria:
a. Meet the definition of intangible assets as defined in the Codification

b. Do not provide the asset holder with enforceable rights to or claims on
c. Are created or reside on a distributed ledger based on blockchain or
similar technology
d. Are secured through cryptography
e. Are fungible
f. Are not created or issued by the reporting entity or its related parties.
> Entities
350-60-15-2 The guidance in this Subtopic applies to all entities that hold crypto
assets.
Glossary
Contribution
An unconditional transfer of cash or other assets, as well as unconditional

promises to give, to an entity or a reduction, settlement, or cancellation of
its liabilities in a voluntary nonreciprocal transfer by another entity acting
other than as an owner. Those characteristics distinguish contributions from:
a. Exchange transactions, which are reciprocal transfers in which each
party receives and sacrifices approximately commensurate value
b. Investments by owners and distributions to owners, which are
nonreciprocal transfers between an entity and its owners
c. Other nonreciprocal transfers, such as impositions of taxes or legal
judgments, fines, and thefts, which are not voluntary transfers.
In a contribution transaction, the resource provider often receives value
indirectly by providing a societal benefit although that benefit is not
considered to be of commensurate value. In an exchange transaction, the
potential public benefits are secondary to the potential direct benefits to the
resource provider. The term contribution revenue is used to apply
to transactions that are part of the entity’s ongoing major or central activities
(revenues), or are peripheral or incidental to the entity (gains). See
also Inherent Contribution and Conditional Contribution.
6
Conditional Contribution
A contribution that contains a donor-imposed condition.
Customer
A party that has contracted with an entity to obtain goods or services that are
an output of the entity’s ordinary activities in exchange for consideration.
Donor-Imposed Condition
A donor stipulation (donors include other types of contributors, including

makers of certain grants) that represents a barrier that must be overcome
before the recipient is entitled to the assets transferred or promised. Failure
to overcome the barrier gives the contributor a right of return of the assets it
has transferred or gives the promisor a right of release from its obligation to
transfer its assets.
Fair Value (second definition)
The price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement
date.
Inherent Contribution
A contribution that results if an entity voluntarily transfers assets (or net

assets) or performs services for another entity in exchange for either no
assets or for assets of substantially lower value and unstated rights or
privileges of a commensurate value are not involved.
Intangible Asset Class
A group of intangible assets that are similar, either by their nature or by their
use in the operations of an entity.
Intangible Assets
Assets (not including financial assets) that lack physical substance. (The term
intangible assets is used to refer to intangible assets other than goodwill.)
7
Market Participants
Buyers and sellers in the principal (or most advantageous) market for the asset
or liability that have all of the following characteristics:
a. They are independent of each other, that is, they are not related
parties, although the price in a related-party transaction may be used
as an input to a fair value measurement if the reporting entity has
evidence that the transaction was entered into at market terms
b. They are knowledgeable, having a reasonable understanding about
the asset or liability and the transaction using all available information,
including information that might be obtained through due diligence
efforts that are usual and customary
c. They are able to enter into a transaction for the asset or liability
d. They are willing to enter into a transaction for the asset or liability, that
is, they are motivated but not forced or otherwise compelled to do so.
Not-for-Profit Entity
An entity that possesses the following characteristics, in varying

degrees, that distinguish it from a business entity:
a. Contributions of significant amounts of resources from resource
providers who do not expect commensurate or proportionate
pecuniary return
b. Operating purposes other than to provide goods or services at a profit
c. Absence of ownership interests like those of business entities.
Entities that clearly fall outside this definition include the following:
a. All investor-owned entities
b. Entities that provide dividends, lower costs, or other economic benefits
directly and proportionately to their owners, members, or participants,
such as mutual insurance entities, credit unions, farm and rural electric
cooperatives, and employee benefit plans.
Orderly Transaction
A transaction that assumes exposure to the market for a period before the
measurement date to allow for marketing activities that are usual and
customary for transactions involving such assets or liabilities; it is not a
forced transaction (for example, a forced liquidation or distress sale).
8
Promise to Give
A written or oral agreement to contribute cash or other assets to another

entity. A promise carries rights and obligations—the recipient of a promise to
give has a right to expect that the promised assets will be transferred in the
future, and the maker has a social and moral obligation, and generally a legal
obligation, to make the promised transfer. A promise to give may be either
conditional or unconditional.
Related Parties
Related parties include:

a. Affiliates of the entity
b. Entities for which investments in their equity securities would be
required, absent the election of the fair value option under the Fair
Value Option Subsection of Section 825-10-15, to be accounted for by
the equity method by the investing entity
c. Trusts for the benefit of employees, such as pension and profit-sharing
trusts that are managed by or under the trusteeship of management
d. Principal owners of the entity and members of their immediate families
e. Management of the entity and members of their immediate families
f. Other parties with which the entity may deal if one party controls or
can significantly influence the management or operating policies of the
other to an extent that one of the transacting parties might be
prevented from fully pursuing its own separate interests
g. Other parties that can significantly influence the management or
operating policies of the transacting parties or that have an ownership
interest in one of the transacting parties and can significantly influence
the other to an extent that one or more of the transacting parties might
be prevented from fully pursuing its own separate interests.
Unconditional Promise to Give
A promise to give that depends only on passage of time or demand by the

promisee for performance.
Subsequent Measurement
General
9
350-60-35-1 An entity shall measure crypto assets at fair value in the
statement of financial position. Gains and losses from the remeasurement of
crypto assets shall be included in net income.
Other Presentation Matters
General
> Statement of Financial Position
350-60-45-1 Crypto assets shall be presented separately from other intangible

assets in the statement of financial position. An entity is permitted to present
crypto assets on a more disaggregated basis (for example, by individual crypto
asset holding or intangible asset class).
> Income Statement
350-60-45-2 Gains and losses from the remeasurement of crypto assets shall
be included in net income and presented separately from changes in the
carrying amount of other intangible assets.
> Statement of Cash Flows
350-60-45-3 For guidance related to the presentation of cash receipts arising

from the sale of crypto assets that are received as noncash consideration in
the ordinary course of business (or as a contribution, in the case of a not-for-
profit entity) and are converted nearly immediately into cash, see paragraphs
230-10-45-21A and 230-10-45-27A.
Disclosure
General
350-60-50-1 At interim and annual reporting periods, an entity shall disclose

the following for each significant (as determined by the fair value) crypto asset
holding:
a. Name of the crypto asset
b. Cost basis
c. Fair value
d. Number of units held.
10
An entity shall disclose the aggregated cost bases and fair values of the crypto
asset holdings that are not individually significant.
350-60-50-2 At annual reporting periods, an entity shall disclose both of the

following:
a. The method used to determine its cost basis for computing gains and
losses (for example, first-in, first-out; specific identification; average
cost; or other method used)
b. If not presented separately, the line item in which gains and losses are
reported in the income statement.
350-60-50-3 At annual reporting periods, an entity shall provide a

reconciliation, in the aggregate, of activity from the opening to the closing
balances of crypto assets, separately disclosing changes during the period
attributable to the following:
a. Additions.
b. Dispositions.
c. Gains included in net income for the period, determined on a crypto-
asset-by-crypto-asset basis. Each crypto asset holding that has a net
gain from remeasurement as included in net income for the period shall
be included in the gains line.
d. Losses included in net income for the period, determined on a crypto-
asset-by-crypto-asset basis. Each crypto asset holding that has a net
loss from remeasurement as included in net income for the period shall
be included in the losses line.
350-60-50-4 An entity shall disclose the following information about the
reconciliation in paragraph 350-60-50-3:
a. A description of the nature of activities that result in additions (for
example, purchases, receipts from customers, or mining activities) and
dispositions (for example, sales or use as payment for services)
b. Total amount of cumulative realized gains and cumulative realized
losses from dispositions that occurred during the period.
350-60-50-5 An entity that receives crypto assets as noncash consideration in

the ordinary course of business (or as a contribution, in the case of a not-for-
profit entity) that are converted nearly immediately into cash need not
include that activity in the disclosures required by paragraphs 350-60-50-3
through 50-4.
11
350-60-50-6 For interim and annual reporting periods, an entity shall disclose
the following information for crypto assets subject to contractual sale
restrictions at the balance sheet date:
a. The fair value of the crypto assets that are subject to contractual sale
restrictions
b. The nature and remaining duration of the restriction(s)
c. Circumstances that could cause the restriction(s) to lapse.
350-60-50-7 In providing the required disclosures in paragraph 350-60-50-6,

an entity with multiple crypto assets subject to contractual sale restrictions shall
consider all of the following:
a. The level of detail necessary to satisfy the required disclosures
b. How much emphasis to place on each of the required disclosures
c. How much aggregation or disaggregation to undertake
d. Whether users of financial statements need additional information to
evaluate the quantitative information disclosed.
Transition and Open Effective Date Information
General
> Transition Related to Accounting Standards Update No. 2023-08,
Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60):
350-60-65-1 The following represents the transition and effective date

information related to Accounting Standards Update No. 2023-08,
Accounting for and Disclosure of Crypto Assets:
a. The pending content that links to this paragraph shall be effective for all
entities for fiscal years beginning after December 15, 2024, including
interim periods within those fiscal years. Early adoption is permitted for
both interim and annual financial statements that have not yet been
issued (or made available for issuance). If an entity adopts the pending
content that links to this paragraph in an interim period, it must adopt the
content as of the beginning of the fiscal year that includes that interim
period.
12
b. An entity shall recognize the cumulative effect of initially applying the
pending content that links to this paragraph as an adjustment to the
opening balance of retained earnings (or other appropriate components
of equity or net assets in the statement of financial position) as of the
beginning of the annual reporting period in which the entity first applies
the pending content that links to this paragraph.
c. The adjustment to the opening balance of retained earnings (or other
appropriate components of equity or net assets in the statement of
financial position) shall be calculated as the difference between the
carrying amount of crypto assets as of the end of the prior annual
reporting period and the fair value of those crypto assets as of the
beginning of the annual reporting period in which the entity first applies
the pending content that links to this paragraph.
Amendments to Subtopic 230-10

3. Amend paragraph 230-10-45-21A and its related heading and add
paragraph 230-10-45-27A and its related heading, with a link to transition
paragraph 350-60-65-1, as follows:
Statement of Cash Flows—Overall
Other Presentation Matters

> Classification
• > Acquisitions and Sales of Certain Securities Securities, and Loans,

and Crypto Assets
230-10-45-21A Cash receipts resulting from the sale of donated financial

assets (for example, donated debt or equity instruments) or crypto assets
accounted for in accordance with Subtopic 350-60 by NFPs that upon receipt
were directed without any NFP-imposed limitations for sale and were converted
nearly immediately into cash shall be classified as operating cash flows. If,
however, the donor restricted the use of the contributed resource to a long-
term purpose of the nature of those described in paragraph 230-10-45-14(c),
then those cash receipts meeting all the conditions in this paragraph shall be
classified as a financing activity.
13
• > Crypto Assets Received as Noncash Consideration
230-10-45-27A If crypto assets accounted for in accordance with Subtopic 350-

60 are received as noncash consideration in the ordinary course of business
(for example, in exchange for goods and services transferred to a customer)
and converted nearly immediately into cash, the cash received shall be
classified as operating activities. In this context, the term nearly immediately
refers to a short period of time that is expected to be within hours or a few days,
rather than weeks.

4. Amend paragraph 270-10-50-7 by adding item p, with a link to transition
Interim Reporting—Overall
Disclosure
> Guidance Related to Disclosure of Other Topics at Interim Dates
270-10-50-7 The following may not represent all references to interim

disclosure:
p. For disclosure requirements for crypto assets, see paragraphs 350-60-
50-1 and 350-60-50-6 through 50-7.

5. Amend paragraphs 350-10-05-3 and 350-10-40-3, with a link to transition
Intangibles—Goodwill and Other—Overall
Overview and Background

350-10-05-3 This Topic includes the following Subtopics:
a. Overall.
14
b. Goodwill—Subtopic 350-20 provides guidance on the measurement of
goodwill after acquisition, derecognition of some or all of goodwill
allocated to a reporting unit, other presentation matters, and
disclosures.
c. General Intangibles Other Than Goodwill—Subtopic 350-30 provides
guidance on the initial recognition and measurement of intangible assets
other than goodwill that are either:
1. Acquired individually or with a group of assets in a transaction that is
not a business combination or an acquisition by a not-for-profit entity
2. Internally generated.
d. Internal-Use Software—Subtopic 350-40 provides guidance on the
accounting for the cost of computer software that is developed or
obtained for internal use and hosting arrangements obtained for
internal use.
e. Website Development Costs—Subtopic 350-50 provides guidance on
whether to capitalize or expense costs incurred to develop a website.
f. Crypto Assets—Subtopic 350-60 provides guidance on the subsequent
measurement, presentation, and disclosure of crypto assets.
In addition, amend the following pending content for paragraph 350-10-

05-3, with a link to transition paragraph 805-60-65-1:
Pending Content
Transition Date: (P) January 1, 2025; (N) January 1, 2025 │ Transition

Guidance: 805-60-65-1
350-10-05-3 This Topic includes the following Subtopics:

a. Overall.
b. Goodwill—Subtopic 350-20 provides guidance on the measurement of
goodwill after acquisition, derecognition of some or all of goodwill
allocated to a reporting unit, other presentation matters, and
disclosures.
c. General Intangibles Other Than Goodwill—Subtopic 350-30 provides
guidance on the initial recognition and measurement of intangible
assets other than goodwill that are either:
1. Acquired individually or with a group of assets in a transaction that is
not a business combination, an acquisition by a not-for-profit entity,
or a joint venture formation
15
2. Internally generated.
d. Internal-Use Software—Subtopic 350-40 provides guidance on the
accounting for the cost of computer software that is developed or
obtained for internal use and hosting arrangements obtained for
internal use.
e. Website Development Costs—Subtopic 350-50 provides guidance on
whether to capitalize or expense costs incurred to develop a website.
f. Crypto Assets—Subtopic 350-60 provides guidance on the subsequent
measurement, presentation, and disclosure of crypto assets.
Derecognition
> Transfer or Sale of Intangible Assets
350-10-40-3 If an entity transfers a nonfinancial asset in accordance with

paragraph 350-10-40-1, and the contract does not meet all of the criteria in
paragraph 606-10-25-1, the entity shall not derecognize the nonfinancial asset
and shall follow the guidance in paragraphs 606-10-25-6 through 25-8 to
determine if and when the contract subsequently meets all of the criteria in
paragraph 606-10-25-1. Until all of the criteria in paragraph 606-10-25-1 are
met, the entity shall continue to do all any of the following, as applicable:
a. Report the nonfinancial asset in its financial statements
b. Recognize amortization expense as a period cost for those assets with
a finite life
c. Apply the impairment guidance in Section 350-30-35 350-30-35.
d. For crypto assets accounted for in accordance with Subtopic 350-60,
recognize gains and losses from remeasurement.

6. Amend paragraph 350-30-15-4, with a link to transition paragraph 350-60-
65-1, as follows:
Intangibles—Goodwill and Other—General Intangibles Other

Than Goodwill
Scope and Scope Exceptions

> Transactions
16
350-30-15-4 The guidance in this Subtopic does not apply to the following:
a. Subparagraph not used.
b. Subparagraph superseded by Accounting Standards Update No. 2010-
07.
c. Except for certain disclosure requirements as noted in paragraph 350-
30-15-3, capitalized software costs
d. Except for disclosures required by paragraph 944-805-50-1 (however,
an insurance entity need not duplicate disclosures that also are required
by paragraphs 944-30-50-2A through 50-2B), intangible assets
recognized for acquired insurance contracts under the requirements of
Subtopic 944-805 944-805.
e. Crypto assets accounted for in accordance with Subtopic 350-60,
except for recognition and initial measurement of crypto assets.

7. Amend paragraph 958-230-55-3, with a link to transition paragraph 350-
60-65-1, as follows:
Not-for-Profit Entities—Statement of Cash Flows
Implementation Guidance and Illustrations

> Implementation Guidance
• > Cash Received with a Donor-Imposed Restriction That Limits Its Use
to Long-Term Purposes
958-230-55-3 When an NFP reports cash received (or cash receipts from the
sale of donated financial assets or crypto assets accounted for in accordance
with Subtopic 350-60 that upon receipt were directed without any NFP-
imposed limitations for sale and were converted nearly immediately into cash
as discussed in paragraph 230-10-45-21A) with a donor-imposed
restriction that limits its use to long-term purposes in conformity with
paragraph 958-210-45-6, an adjustment to the change in net assets to
reconcile to net cash flows from operating activities is necessary when using
the indirect method of reporting cash flows in order to present those cash
receipts as cash inflows from financing activities as required by paragraph 230-
10-45-14(c).
17
Amendments to Status Sections
8. Amend paragraph 230-10-00-1, by adding the following items to the table,
as follows:
230-10-00-1 The following table identifies the changes made to this Subtopic.
Accounting
Standards
Paragraph Action Update Date
230-10-45-21A Amended 2023-08 12/13/2023
230-10-45-27A Added 2023-08 12/13/2023
9. Amend paragraph 270-10-00-1, by adding the following item to the table,

as follows:
Accounting
Standards
270-10-50-7 Amended 2023-08 12/13/2023
10. Amend paragraph 350-10-00-1, by adding the following items to the table,
as follows:
Accounting
Standards
350-10-05-3 Amended 2023-08 12/13/2023
350-10-40-3 Amended 2023-08 12/13/2023
as follows:
18
Accounting
Standards
350-30-15-4 Amended 2023-08 12/13/2023
12. Add paragraph 350-60-00-1 as follows:
Accounting
Standards
Contribution Added 2023-08 12/13/2023
Conditional Added 2023-08 12/13/2023
Contribution
Customer Added 2023-08 12/13/2023
Donor-Imposed Added 2023-08 12/13/2023
Condition
Fair Value (2nd def.) Added 2023-08 12/13/2023
Inherent Added 2023-08 12/13/2023
Contribution
Intangible Asset Added 2023-08 12/13/2023
Class
Intangible Assets Added 2023-08 12/13/2023
Market Participants Added 2023-08 12/13/2023
Not-for-Profit Entity Added 2023-08 12/13/2023
Orderly Transaction Added 2023-08 12/13/2023
Promise to Give Added 2023-08 12/13/2023
Related Parties Added 2023-08 12/13/2023
Unconditional Added 2023-08 12/13/2023
Promise to Give
19
Accounting
Standards
350-60-05-1 Added 2023-08 12/13/2023
350-60-05-2 Added 2023-08 12/13/2023
350-60-15-1 Added 2023-08 12/13/2023
350-60-15-2 Added 2023-08 12/13/2023
350-60-35-1 Added 2023-08 12/13/2023
350-60-45-1 through Added 2023-08 12/13/2023
45-3
350-60-50-1 through Added 2023-08 12/13/2023
50-7
350-60-65-1 Added 2023-08 12/13/2023
as follows:
Accounting
Standards
958-230-55-3 Amended 2023-08 12/13/2023
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The amendments in this Update were adopted by the unanimous vote of the
seven members of the Financial Accounting Standards Board:
Richard R. Jones, Chair

James L. Kroeker, Vice Chairman
Christine A. Botosan
Frederick L. Cannon
Susan M. Cosper
Marsha L. Hunt
Dr. Joyce T. Joseph
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Background Information and
Basis for Conclusions
Introduction
BC1. The following summarizes the Board’s considerations in reaching the
conclusions in this Update. It includes reasons for accepting certain
approaches and rejecting others. Individual Board members gave greater
weight to some factors than to others.
Background Information
BC2. Before adding this project to its agenda, the Board directed the staff to
conduct research and monitor developments in the accounting for and
reporting of crypto assets. That research focused on whether there was a
pervasive need to improve financial reporting, whether feasible solutions
existed, and whether a scope for the project could be established. The staff
performed pre-agenda research with stakeholders and monitored the
development of U.S. accounting practice and the application of both existing
authoritative and nonauthoritative guidance and guidance in other jurisdictions.
The Board also considered multiple agenda requests that highlighted concern
that the current accounting for crypto assets as indefinite-lived intangible
assets does not reflect the economic nature of those assets because of the
historical-cost-less-impairment accounting model that applies to their
subsequent measurement.
BC3. Stakeholders’ feedback, including respondents to the 2021 FASB

Invitation to Comment (ITC), Agenda Consultation, indicated that improving the
accounting for and disclosure of crypto assets should be a top priority for the
Board. Nearly 500 respondents to the 2021 ITC requested that the Board add
to its agenda a project related to crypto assets. Although some stakeholders
made observations about other aspects of the accounting for crypto assets and
related transactions, stakeholders indicated that the current accounting for
crypto assets under a cost-less-impairment accounting model does not provide
investors, lenders, creditors, and other allocators of capital (collectively,
“investors”) with decision-useful information. Specifically, those stakeholders
noted that reflecting only the decreases but not the increases in the value of
crypto assets in the financial statements until they are sold does not reflect (a)
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the underlying economics of those assets and (b) an entity’s financial position.
Investors also requested additional disclosures about the types of crypto assets
held by entities and changes in those holdings.
BC4. Some stakeholders requested that the Board add a project on crypto
assets to its agenda because measuring crypto assets at historical cost less
impairment created a barrier to acceptance of crypto assets. The Board did not
give any weight to this feedback as a rationale for adding this project to its
agenda or in making decisions. Rather, the Board acknowledged the need to
(a) improve the accounting for crypto assets in order to provide investors with
more decision-useful financial information and (b) reduce complexity related to
the application of the current accounting to crypto assets.
BC5. Throughout this project, the Board and staff conducted substantial
outreach with investors, preparers, practitioners, regulators, industry groups,
and others to obtain their views about key considerations in this project. Those
stakeholders provided input about how investors would use that information
and the expected cost and operability of the Board’s decisions. Those outreach
activities included more than 180 interactions with stakeholders in groups or
one-on-one meetings.
BC6. Many stakeholders indicated that applying the current accounting to

crypto assets is unnecessarily complex and costly. Some crypto assets are
frequently traded, which is not typical for most intangible assets. For indefinite-
lived intangible assets, entities are required to test for impairment annually and
more frequently if events or circumstances indicate that it is more likely than
not that the asset is impaired. For crypto assets, this process results in
reporting entities considering price and other information throughout the
reporting period. In addition, reporting entities often voluntarily provide their
investors with fair value or price information as of the end of their reporting
period.
BC7. The Board issued proposed Accounting Standards Update,

Accounting for and Disclosure of Crypto Assets, for public comment on March
23, 2023, and received 83 comment letters in response to the amendments in
that proposed Update. Overall, comment letter respondents supported the
proposed amendments and the project’s objectives. While nearly all
respondents expressed broad support for the proposed scope, measurement,
presentation, and disclosure requirements, some respondents suggested
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clarifications and other potential improvements. The Board considered
stakeholders’ feedback received throughout the course of this project and
respondents’ comments in reaching its conclusions in this Update, as
discussed further below.
Benefits and Costs

BC8. The objective of financial reporting is to provide information that is
useful to present and potential investors, creditors, donors, and other capital
market participants in making rational investment, credit, and similar resource
allocation decisions. However, the benefits of providing information for that
purpose should justify the related costs. Present and potential investors,
creditors, donors, and other allocators of capital benefit from improvements in
financial reporting, while the costs to implement new guidance are borne
primarily by present investors. The Board’s assessment of the costs and
benefits of issuing new guidance is unavoidably more qualitative than
quantitative because there is no method to objectively measure the costs to
implement new guidance or to quantify the value of improved information in
financial statements.
BC9. On the basis of stakeholders’ substantial input, the Board concluded

that applying the amendments in this Update provides investors with more
decision-useful information than current GAAP. In particular, the amendments
improve the accounting for crypto assets by requiring that all changes in fair
value be recognized in net income, which will provide investors with greater
transparency about an entity’s holdings of crypto assets. The Board observed
that the current accounting, which reflects only decreases but not increases in
the value of crypto assets in an entity’s financial statements until those assets
are sold, does not reflect the underlying economics of those assets and does
not provide decision-useful information about future cash flows that may be
generated by those assets.
BC10. In addition, reporting crypto assets at fair value aligns the accounting
required for all holders of crypto assets with the accounting required for entities
that follow certain industry-specific guidance (such as investment companies
within the scope of Topic 946, Financial Services—Investment Companies)
and eliminates the requirement for those entities to test crypto assets for
impairment, reducing the cost and complexity of applying the current guidance.
The amendments in this Update also improve the information provided to
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investors about an entity’s crypto asset holdings by requiring disclosure about
the types of and changes in holdings of crypto assets.
BC11. When making its decisions, the Board considered the benefits and
costs of specific requirements, as well as the overall benefits and costs of the
amendments in this Update. The Board noted that there may be incremental
costs of applying some provisions of the amendments that may offset the
reductions in costs that will result from no longer applying the existing
requirements. The costs of applying the amendments will vary depending on
several factors, including whether an entity is currently determining the fair
value measurement of crypto assets for voluntary reporting or other purposes
and whether the entity’s existing systems can track costs, impairments, and
changes in a crypto asset’s value. For example, some stakeholders indicated
that measuring crypto assets without quoted prices in active markets at fair
value could result in incremental costs and challenges. However, research and
outreach conducted with other stakeholders indicated that those costs and
challenges could be present in applying the current cost-less-impairment
accounting model. Furthermore, nearly all comment letter respondents stated
that measuring crypto assets at fair value would not be costly or complex.
BC12. The Board also acknowledged that the amendments in this Update
could introduce additional costs for preparers to comply with those
requirements. In particular, comment letter respondents mentioned costs
related to the cost basis and historical realized gain and loss disclosures.
However, most comment letter respondents as well as other research and
outreach conducted with stakeholders indicated that the costs of preparing and
providing the required disclosures are not expected to be significant. Overall,
the Board decided that the expected benefits of the amendments justify the
expected costs.
Basis for Conclusions

Scope
BC13. In developing the scope criteria, the Board sought to leverage existing
guidance and provide a solution that would clearly describe and address the
population of crypto assets whose accounting, according to most stakeholders,
should be improved. The Board considered the definition of and current
accounting for certain assets, including intangible assets, securities, and other
financial assets, to determine whether, and to what extent, those existing
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definitions (or aspects of them) should be leveraged. The Board also
considered key characteristics of crypto assets that differentiate them from
other assets and the fungibility and marketability of crypto assets. The Board
acknowledged that the criteria result in a relatively narrow, but in the Board’s
view, appropriately defined scope, given the wide range of digital and other
assets.
BC14. The Board decided that assets that meet all of the following criteria are
subject to the amendments in this Update:
a. Meet the definition of intangible assets as defined in the Codification
b. Do not provide the asset holder with enforceable rights to or claims on
c. Are created or reside on a distributed ledger based on blockchain or
similar technology
d. Are secured through cryptography
e. Are fungible
f. Are not created or issued by the reporting entity or its related parties.
BC15. The Board determined that crypto assets created or issued by a

reporting entity or its related parties should be excluded from the scope of the
amendments in this Update. The Board observed that stakeholders did not ask
that the Board address an issuer’s accounting. In addition, many issuers and
others did not support measuring crypto assets created or issued by a reporting
entity or its related parties at fair value.
BC16. While many comment letter respondents agreed with the Board’s
decision to exclude crypto assets created or issued by a reporting entity or its
related parties, some respondents requested that the Board address the
accounting for issuers of crypto assets in a future project. Others noted that fair
value measurement may become relevant for crypto assets created and held
by an issuer when the issuer’s involvement with the crypto assets diminishes
over time. The Board affirmed its decision to exclude the accounting for crypto
assets created or issued by the reporting entity because stakeholders broadly
agreed that the need to address the issuer’s accounting is less pervasive and
addressing the accounting for issuers of crypto assets would expand the scope
of the project.
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BC17. Some stakeholders questioned whether a reporting entity that mines
crypto assets would be excluded from the scope of the amendments in this
Update. The Board clarified that a reporting entity that mines or validates and
receives newly created crypto assets is not the creator of the crypto assets that
it receives as consideration for performing services if mining or validating is the
only involvement that an entity has in the creation of the asset.
BC18. The Board observed that the definition of intangible assets generally
includes the types of crypto assets that stakeholders stated needed
improvements in accounting. That definition specifically excludes financial
assets. Therefore, fiat currency and many securities are excluded and should
be accounted for under other GAAP. The Board also observed that there are
multiple definitions of security and that certain assets that are considered
securities for regulatory purposes may not be considered securities as defined
in the Master Glossary.
BC19. The Board included a scope criterion that excludes crypto assets that
provide the holder with enforceable rights to or claims on underlying goods,
services, or other assets. Without that criterion, some Board members
observed that the accounting for certain arrangements—such as contracts with
customers, guarantees, and insurance contracts—inadvertently could be
included within the scope of the amendments in this Update. Those
arrangements, which may be in digital form, should continue to be subject to
other GAAP.
BC20. Some respondents to the proposed Update requested that the Board
clarify the meaning of the term enforceable and whether a legal opinion would
be necessary. The Board observed that the notion of an enforceable right is
used throughout GAAP and agreed with respondents who observed that
determining whether there are enforceable rights may require judgment.
Furthermore, the Board noted that in many, but not necessarily all, cases it will
be clear whether a crypto asset provides an asset holder with enforceable
rights to underlying goods, services, or other assets.
BC21. The Board observed that crypto assets may provide an asset holder
with rights to other crypto assets and, therefore, are outside the scope of the
amendments in this Update. In deciding to include this scope criterion in the
proposed Update, the Board expressed concern that broadening the scope to
include crypto assets that provide rights to other crypto assets was not
identified as pervasive and expanding the scope to include crypto assets that
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derive value principally by providing rights to other assets could have
consequences that have not been fully evaluated. Respondents broadly
supported the proposed scope, partly because a narrower scope would allow
the Board to finalize the amendments in this Update in a timely manner. More
than a quarter of the respondents requested that the scope include assets that
provide rights to other crypto assets. The Board considered the feedback and,
for reasons similar to those described above, affirmed the criterion as
proposed.
BC22. The scope criteria also include certain characteristics of crypto assets
that differentiate them from other assets, that is, they are created, or reside on,
a distributed ledger based on blockchain or similar technology and are secured
through cryptography. The Board decided that including those characteristics
within the scope criteria will prevent other digital intangible assets, such as
software and media, from being included within the scope of the amendments
in this Update. In addition, on the basis of outreach and comment letter
feedback, the Board sought to describe the technological form of those assets
within the scope criteria while also providing flexibility because of the continued
evolution in the technology underlying crypto assets. The Board considered but
ultimately decided not to specify that the distributed ledger should be public
because determining the meaning of public in this context would require
judgment and may be complex.
BC23. The Board decided to include fungibility as a criterion because

obtaining market prices for items that are not fungible could be costly and
complex and fair value measurement may not be relevant for nonfungible
items. The fungibility criterion excludes nonfungible tokens (NFTs) from the
amendments in this Update. Investors indicated that they do not observe
reporting entities holding material amounts of NFTs at this time and that if they
were to observe those holdings, the reported value may not affect their
analyses or capital allocation decisions because of the nature of those assets
and the uncertainty surrounding their value. Many respondents supported the
proposed scope criterion. Excluding NFTs from the scope of the amendments
also is consistent with the feedback received from many respondents to the
ITC that favored a narrow-scope project.
BC24. In developing the scope criteria for the amendments in this Update,
the Board acknowledged that other characteristics, such as “medium of
exchange” and “store of value,” are used by others when describing or defining
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crypto assets. The Board did not include those characteristics because (a)
other assets, such as fiat currency, may share those characteristics and (b)
evaluating whether those characteristics exist for financial reporting purposes
may be subjective. Therefore, including those characteristics within the scope
criteria could have increased the cost and complexity of an entity’s assessment
of whether an asset is within the scope of the amendments.
BC25. The Board also considered whether to exclude crypto assets without
an active market from the amendments in this Update. The Board ultimately
dismissed that alternative, however, because (a) that criterion could have
resulted in complexity because, for example, a crypto asset could be moved
within and outside the scope based on changes in the market activity for that
asset, (b) if those assets were excluded from the amendments, the
presentation and disclosure requirements would not have applied to those
assets, (c) the existence of an active market is considered part of the fair value
measurement of crypto assets in accordance with Topic 820, Fair Value
Measurement, and (d) the impairment testing guidance still requires that an
entity determine fair value for the purpose of recognizing any potential
impairment loss. Almost all respondents agreed with the Board’s decision,
which did not exclude crypto assets without an active market.
Entities
BC26. The accounting for intangible assets applies broadly to public business
entities, private companies, not-for-profit entities, and employee benefit plans.
Stakeholders stated that applying current guidance to crypto assets is costly
and complex and is not consistent with the underlying economics of those
assets. Therefore, Board members agreed that improving the accounting,
presentation, and disclosures for crypto assets that meet the scope criteria
benefits all entities. Comment letter respondents supported the broad
application of the amendments in this Update for all entities.
BC27. Although industry-specific guidance, such as guidance for investment

companies, currently permits or requires accounting for crypto assets at fair
value, the Board decided that it is beneficial to include those entities within the
scope of the amendments in this Update primarily because investors will
benefit from enhanced disclosures. Subtopic 946-205, Financial Services—
Investment Companies—Presentation of Financial Statements, requires
presentation of a statement of net assets, which includes a schedule detailing
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an entity’s investments on a more disaggregated basis, and provides guidance
on the presentation of changes in the fair value of investments in an investment
company’s statement of operations. The Board decided that investment
companies should continue to present amounts related to crypto assets in their
financial statements in accordance with that industry-specific guidance.
BC28. The Board also considered the Private Company Decision-Making

Framework: A Guide for Evaluating Financial Accounting and Reporting for
Private Companies, and consulted the Private Company Council to determine
whether exceptions or practical expedients related to measurement,
presentation, and disclosure were needed. The Board did not receive feedback
from private company investors indicating that they have different informational
needs related to crypto assets. Furthermore, on the basis of stakeholders’
feedback received, including support from the investors on the Private
Company Council, the Board decided that private company investors generally
will benefit from having more relevant information about crypto assets. The
amendments in this Update also are expected to reduce the cost and
complexity for some entities. Therefore, the Board decided not to include any
exceptions or practical expedients for private companies.
Measurement
BC29. The amendments in this Update require that an entity subsequently
measure crypto assets at fair value at each reporting period. The Board
decided to require fair value measurement because it will provide investors with
more decision-useful information about the value at which crypto assets can
be sold and about changes in that value. In reaching that conclusion, the Board
observed that the predominant way that an entity realizes value from a crypto
asset that meets the scope criteria is through exchange and crypto assets are
not used in combination with any other assets to generate value. The fair value
measurement guidance in Topic 820 also is well understood in practice and
familiar to many investors because it is used to measure other assets. Nearly
all comment letter respondents and other stakeholders, including those who
responded to the ITC, supported requiring that entities measure crypto assets
at fair value for similar reasons.
BC30. Before the issuance of the proposed Update, the Board considered
and dismissed two other measurement alternatives—historical cost with
modified impairment (which would have required that an entity test crypto
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assets for impairment only as of the end of the reporting period) and net
realizable value—on the basis that, among other reasons, the alternatives
would have provided investors with less relevant information. That is because
the historical-cost-with-modified-impairment alternative would have prohibited
the recognition of increases in price movement and the net-realizable-value
alternative would have introduced a new measurement basis for crypto assets
that would have created measurement differences between entities. Two
respondents to the proposed Update recommended measurement
alternatives, one of which would have been to provide an option to use the
current cost-less-impairment accounting model for measuring some or all of an
entity’s crypto asset holdings. The Board did not support providing entities with
an option, as opposed to a requirement, to subsequently measure crypto
assets at fair value because it would have diminished comparability between
similar entities and similar assets, would have resulted in additional effort for
investors to understand an entity’s measurement policies and evaluate the
entity’s financial results, and likely would not have reduced costs or complexity
for preparers.
BC31. The Board also considered whether the guidance in Topic 820
provides a sufficient basis for entities to measure the fair value of crypto assets.
Specifically, the Board observed that Topic 820 provides guidance on:
a. Identifying the principal (or most advantageous) market
b. Categorizing the inputs to valuation techniques used to measure fair
value into three levels within the fair value hierarchy
c. Determining how fair value may be affected by transactions with related
parties
d. Measuring fair value when the volume or level of activity for an asset
has decreased significantly
e. Identifying transactions that are not orderly
f. Using quoted prices provided by third parties.
BC32. While judgment may be required in evaluating those aspects of Topic

820 when measuring the fair value of crypto assets, an evaluation of those
aspects involving judgment also is required when measuring other assets in
accordance with Topic 820. Therefore, the Board decided that the existing
guidance in Topic 820 is sufficient. Additionally, the Board acknowledged that
reporting entities currently apply the fair value measurement principles in Topic
820 when determining impairments under the cost-less-impairment accounting
model and when following industry-specific guidance that requires or allows fair
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value measurement for crypto assets. Although a few comment letter
respondents suggested that the Board either provide additional measurement
guidance or clarify the application of certain aspects of Topic 820 to crypto
assets, almost all respondents indicated that Topic 820 is operable and
sufficient for measuring the fair value of crypto assets within the scope of the
amendments in this Update.
Certain Transaction Costs to Acquire Crypto Assets

BC33. The Board proposed that transaction costs to acquire crypto assets,
such as commissions and other related transaction fees, should be expensed
as incurred unless an entity capitalizes those costs in accordance with industry-
specific guidance (for example, investment companies within the scope of
Topic 946). A majority of the Board supported the proposal to expense
transaction costs because it would (a) provide investors with greater visibility
into gains and losses that arise because of price changes in an entity’s crypto
asset holdings and (b) eliminate the potential for diversity in practice.
BC34. While a majority of comment letter respondents supported the Board’s

proposal to expense transaction costs as incurred, some respondents stated
that expensing transaction costs would not align with other areas of GAAP that
either require that an entity capitalize transaction costs or do not provide
guidance on the accounting for transaction costs. Some respondents preferred
capitalizing transaction costs because including those costs in the gains and
losses from holding a crypto asset would better reflect the performance of that
holding and a few of those respondents noted that it would align with industry-
specific guidance for investment companies. Other respondents either (a)
supported an option that would allow entities to either capitalize or expense
transaction costs or (b) stated that it is unnecessary for the Board to provide
guidance on the accounting for transaction costs for crypto assets.
BC35. In considering the comment letter feedback, the Board acknowledged

that requiring transaction costs to be expensed as incurred may not provide
investors with decision-useful information because the amendments in this
Update do not require separate presentation or disclosure of those costs.
Additionally, the Board observed that, regardless of whether transaction costs
are capitalized or expensed, the effect on comprehensive income in the period
that crypto assets are acquired is the same because those crypto assets are
required to be remeasured to fair value.
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BC36. Therefore, the Board decided not to provide guidance on how to
recognize or present transaction costs to acquire crypto assets. In addition, the
amendments in this Update do not amend industry-specific guidance for an
entity that is required to capitalize transaction costs.
Alternatives Considered for Measuring Crypto Assets

without Quoted Prices in Active Markets
BC37. While almost all ITC respondents and other stakeholders supported
fair value measurement, some stakeholders raised concerns about whether fair
value is an appropriate measurement basis for crypto assets that do not have
a quoted price in an active market. One concern noted was that the techniques
and inputs used to value crypto assets using a market approach may be
unreliable, which could result in financial information that lacks relevance.
Additionally, because of the largely unregulated nature of crypto asset markets,
certain transactions that are not orderly (for example, wash trades that are
intended to manipulate prices) may appear as orderly transactions and could
distort an entity’s fair value measurement. Therefore, those stakeholders
suggested that the Board preclude fair value measurement of crypto assets
without existing active markets.
BC38. Other stakeholders expressed different views on applying the

valuation techniques described in Topic 820. Some observed that the
economic benefits provided to the holders of crypto assets are realized through
the exchange of those assets. Therefore, those stakeholders indicated that it
would be rare to apply any valuation technique other than a market approach
based on observed transactions or market quotes when measuring a crypto
asset’s fair value. Certain stakeholders also suggested that when there is no
quoted market price in an active market, the appropriate measure would be
zero. Other stakeholders disagreed with that view but acknowledged that the
fair value measurement of a crypto asset with no quoted market price in an
active market may be a minimal or immaterial amount. Board members agreed
that the application of the guidance in Topic 820 may result in a fair value for
those crypto assets that is minimal or zero.
three measurement alternatives for crypto assets without quoted prices in
active markets:
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a. Require that the cost-less-impairment accounting model be applied until
the market for the crypto asset becomes active
b. Provide reporting entities with a policy election to remeasure those
assets at fair value only upon impairment and when observable orderly
transactions occur
c. Require that those assets be measured at zero until the market for the
crypto asset becomes active.
BC40. The Board rejected those measurement alternatives for several

reasons. Topic 820 specifically addresses the broadly applicable requirements
for measuring the fair value of assets and liabilities without quoted prices in
active markets. Additionally, entities that apply the current cost-less-
impairment accounting model are required to determine the fair value of all
crypto assets, including those without quoted prices in active markets, to
evaluate those assets for impairment. Entities that follow certain industry-
specific guidance (for example, investment companies within the scope of
Topic 946) measure crypto assets at fair value, regardless of whether there are
quoted prices in an active market for those assets. Furthermore, unless there
is a requirement to measure those assets at zero, an entity is still required to
determine the fair value for impairment purposes.
BC41. Almost all comment letter respondents supported the Board’s decision
not to provide measurement alternatives for crypto assets without quoted
prices in active markets. The few respondents that disagreed recommended
measurement alternatives that are similar to those that the Board considered
and rejected. Additionally, there was no clear consensus among respondents
on how they would describe or define an inactive market for crypto assets.
Therefore, the amendments in this Update do not provide any measurement
alternatives for crypto assets without a quoted price in an active market.
Presentation
Statement of Financial Position
BC42. Reporting entities currently are required, at a minimum, to present all
intangible assets as a separate line item in the balance sheet. The
amendments in this Update require that an entity present crypto assets
measured at fair value separately from intangible assets measured at historical
cost less amortization and impairment. The Board decided that crypto assets
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should be presented separately from other intangible assets because they are
measured and generate benefits differently from other intangible assets.
Additionally, separately presenting crypto assets better responds to investors’
requests that information about crypto assets should be transparently
displayed in the financial statements.
BC43. Nearly all comment letter respondents supported separate

presentation of crypto assets measured at fair value from intangible assets
measured at historical cost less amortization and impairment. One comment
letter respondent requested that the Board provide presentation guidance for
the classification of crypto assets as either current or noncurrent in a classified
balance sheet. However, the Board decided not to provide incremental
presentation guidance for crypto assets because Topic 210, Balance Sheet,
provides adequate guidance for determining the balance sheet classification of
assets.
Income Statement
BC44. The amendments in this Update require that an entity include all
changes from the remeasurement of crypto assets in net income. The Board
decided that reflecting the periodic changes in net income, combined with
additional disclosures about an entity’s crypto assets at each balance sheet
date, provides investors with relevant information about how management is
generating value from its crypto asset positions over time. Outreach also
indicated that most stakeholders favor aligning the accounting for crypto assets
with the accounting for investments in equity securities because both are
investments without defined payouts and maturity dates. Requiring periodic
changes from the remeasurement of crypto assets in net income is consistent
with the presentation requirements for those changes in investments in equity
securities.
BC45. Nearly all comment letter respondents supported including changes

from the remeasurement of crypto assets in net income. However, a few
stakeholders supported including changes in the fair value of crypto assets in
other comprehensive income until those gains and losses are realized through
the sale or disposal of the crypto asset. Those stakeholders were concerned
primarily about the volatility in earnings that the changes in fair value may
cause.
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BC46. The Board decided not to present changes in the fair value of crypto
assets in other comprehensive income. Many investors said that they would
prefer to see that volatility reflected in net income because it would provide
transparent, decision-useful information about the performance of crypto
assets and an entity’s ability to manage them. Furthermore, neutrally reflecting
changes (that is, both decreases and increases in fair value) in net income
would improve financial reporting and address concerns that the current
accounting model does not reflect the underlying economics of crypto assets.
BC47. The Board also decided to present aggregate gains and losses on
crypto assets separately from amortization expense and impairment losses of
other intangible assets. Similar to its decisions on the balance sheet
presentation, the Board decided that changes from remeasurement of crypto
assets should be presented separately from changes in other intangible assets
because crypto assets are measured and generate benefits differently from
other intangible assets.
BC48. Several comment letter respondents recommended that the Board

clarify whether changes from remeasurement should be presented in operating
or nonoperating income. Those respondents commented that without specific
guidance entities would analogize to other GAAP, which could result in diversity
in practice. The Board considered that feedback and observed that an entity
should classify gains or losses from the remeasurement of crypto assets as
operating or nonoperating based on its facts and circumstances. Additionally,
the Board observed that GAAP does not provide explicit guidance on the
income statement presentation of gains and losses from the remeasurement
of other assets, such as equity securities.
BC49. A few comment letter respondents recommended that the Board

provide guidance on the presentation of realized and unrealized gains and
losses in the income statement. The Board observed that gains and losses on
crypto assets are the result of fair value remeasurements throughout the
holding period. Because those assets are remeasured at fair value up to the
date of sale, the gain or loss recognized as a result of sale may be zero. In
addition, because gains and losses on crypto assets are recognized in net
income at each remeasurement (unlike certain debt securities), there is no
recognition upon disposition of gains or losses that have been recognized in
other comprehensive income. The Board acknowledged that, in practice, some
consider the difference between the carrying amount at the last balance sheet
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date and the consideration received at the time of sale to be a realized gain or
loss. However, that amount does not represent the total amount of realized
gains and losses from disposition, which is the difference between the disposal
price and the cost basis of the asset. The total realized gain or loss from
disposition is required to be disclosed under the amendments in this Update.
Therefore, the Board observed that distinguishing whether gains and losses
recognized in a given period are realized or unrealized is unnecessary and
could be confusing.
Statement of Cash Flows

BC50. The amendments in this Update specify that cash receipts arising from
crypto assets that are received as noncash consideration in the ordinary course
of business (or as a contribution, in the case of a not-for-profit entity) and are
converted nearly immediately into cash should be presented as operating cash
flows.
BC51. The Board decided that specific presentation requirements are

important for crypto asset transactions with near immediate liquidation because
a different classification in the specified circumstances likely would mislead
investors. That is because classifying these cash receipts as investing activities
when an entity receives crypto as a form of consideration for a routine operating
activity or as a contribution that is immediately (or nearly immediately)
converted to cash would not reflect the economics of the activity and could
diminish an investor’s ability to assess the uncertainty of an entity’s prospective
cash flows. The Board expects that entities will be able to apply that guidance
consistently without creating additional cost or complexity. Almost all comment
letter respondents supported the proposed classification of those cash flows as
operating activities because it would better reflect the economics of the activity.
BC52. Similarly, on the basis of feedback received in the comment letters,

the Board decided to require that a not-for-profit entity that nearly immediately
liquidates crypto assets received with donor-imposed restrictions for long-term
or capital use classify the cash inflows as financing, which is consistent with
the required classification of donated financial assets with those donor-
imposed restrictions.
BC53. The Board intended the phrase nearly immediately to mean a short
period of time that is expected to be within hours or a few days, rather than
weeks. Almost all comment letter respondents supported the Board’s decision
37
on using the phrase nearly immediately in the context of crypto asset
transactions. The Board expects that the meaning of the phrase nearly
immediately in the context of businesses to be similar but not identical to the
meaning of the phrase in the context of not-for-profit entities. Paragraph BC8
of Accounting Standards Update No. 2012-05, Statement of Cash Flows (Topic
230)—Not-for-Profit Entities: Classification of the Sale Proceeds of Donated
Financial Assets in the Statement of Cash Flows, states that the term nearly
immediately in the context of the liquidation of donated financial assets means
days, not months. For that reason, the Board concluded that it would be
appropriate for not-for-profit organizations to apply the same threshold to the
sale proceeds of donated crypto assets as to the sale proceeds of donated
financial assets.
BC54. Notwithstanding the amendments in this Update, on the basis of

requests for incremental guidance from some respondents, the Board also
considered whether the current guidance is sufficient for entities to determine
the presentation of cash and noncash activities related to other crypto asset
transactions in the statement of cash flows. Current guidance does not
prescribe a particular classification for the cash paid to acquire, or cash
received to sell, intangible assets. The Board concluded that incremental cash
flow presentation guidance for crypto assets is unnecessary because the
guidance in Topic 230, Statement of Cash Flows, although not specific to
crypto assets, provides sufficient guidance for classifying cash flows. Entities
should continue to apply Topic 230 in classifying cash flows associated with
crypto asset transactions based on an entity’s facts and circumstances,
including evaluating the nature of the cash flows and the purpose of the
activities that give rise to them, which will involve judgment.
Disclosure
BC55. A key objective for this project, based on stakeholders’ feedback on
the ITC and outreach, is to improve the information about crypto assets
provided to investors in the financial statements.
BC56. Chapter 8, Notes to Financial Statements, of FASB Concepts

Statement No. 8, Conceptual Framework for Financial Reporting, suggests
possible information for the Board’s consideration when deciding on the
disclosure requirements for a Topic in the Codification. The amendments in this
Update result from the Board’s consideration of the guidance in Chapter 8 of
38
Concepts Statement 8 as well as feedback received from outreach with
stakeholders and comment letter respondents. The enhancement to
disclosures is incremental to any disclosures required by other Topics to which
crypto assets or the entities that hold them may be subject.
BC57. The Board affirmed that the fair value disclosures required by Topic
820 are required for crypto assets. The Board concluded that the disclosure
requirements in that Topic provide decision-useful information about crypto
assets measured at fair value. In affirming that the Topic 820 fair value
disclosures should be provided for crypto assets, the Board observed that
private companies are exempt from certain of those disclosure requirements.
BC58. Additionally, for all entities, the Board considered disclosures beyond
those required by Topic 820 related to the unique nature of crypto assets, the
variation in the regulation of domestic and international markets for crypto
assets, and the relative maturity of the markets in which crypto assets are
traded. The Board considered those additional disclosures for all holders of
crypto assets to improve the information provided to investors and increase
comparability.
Significant Holdings Disclosure

BC59. Investors requested more transparency about an entity’s individual
holdings of crypto assets to understand the present risks at the reporting date.
The Board proposed that entities disclose at interim and annual periods for
each significant holding of crypto assets the name, cost basis, fair value, and
number of units held, as well as the aggregate fair value and cost basis of the
crypto asset holdings that are not individually significant. Determining which
crypto asset holdings are significant should be based on the fair value of each
holding.
BC60. Many respondents commented that the proposed significant holdings

disclosure is operable and that requiring that disclosure will allow investors to
analyze and assess the exposure and risk of significant individual crypto asset
holdings. The Board decided not to prescribe what cost method a reporting
entity must use when determining and disclosing the cost basis (for example,
first-in, first-out; specific identification; average cost; or other method used) and
decided to require disclosure of the cost basis used. The majority of
respondents supported the Board’s decision not to prescribe a cost method.
Respondents observed that entities analogize to existing guidance and
39
consider various factors in selecting a cost method and that prescribing a cost
method would be complex and costly for entities to implement. On the basis of
feedback from respondents, the Board decided to require the disclosure as
proposed.
BC61. Although some comment letter respondents suggested that the Board
prescribe a threshold for determining significant holdings (such as an entity’s
top 5 or 10 crypto asset holdings by fair value), there was no consensus on
what that threshold should be. The Board decided, and many comment letter
respondents agreed, that a bright line may not be suitable and may be
insufficient in reflecting an entity’s risks associated with various crypto assets.
Therefore, the Board decided to allow entities to use appropriate judgment to
determine their significant holdings. Using the term significant holdings is
consistent with other GAAP requirements and is not further defined in the
amendments in this Update.
BC62. A trade group recommended that the Board provide certain investment
companies within the scope of Topic 946 with an exemption from the significant
holdings disclosure because it is similar to what is required to be disclosed as
part of the schedule of investments. The Board observed that an entity is not
required to duplicate the significant holdings disclosure if that information is
presented or disclosed elsewhere in the financial statements. However, if an
entity provides the information required in the significant holdings disclosure
outside the financial statements, that entity must provide the required
disclosures within the financial statements.
Restrictions of Crypto Assets Disclosure

BC63. The Board decided to require that an entity disclose when its crypto
assets are subject to contractual sale restrictions, the fair value of the restricted
crypto assets, the nature and remaining duration of the restriction, and the
circumstances that would cause the restriction to lapse. In outreach, investors
supported requiring this disclosure because it would provide additional
information about the liquidity risk associated with an entity’s holding of
restricted crypto assets. Most comment letter respondents who commented on
that disclosure supported this requirement for similar reasons.
40
Reconciliation of Crypto Assets Held during the Period
Disclosure
BC64. Investors who participated in outreach on this project and many
comment letter respondents supported disclosing the reconciliation of the
beginning and ending balances of crypto asset holdings because it would
provide information about an entity’s crypto asset activities during the period
and capital allocation strategy. Furthermore, some respondents stated that a
disclosure of this nature may not be costly because crypto asset recordkeeping
software currently tracks the information that would be necessary to provide
the reconciliation. Some respondents that are not investors disagreed and
stated that the disclosure would not be decision useful and would be excessive
given the other disclosures that the Board proposed and other existing
disclosure requirements in GAAP. However, based on strong support from
investors, the Board decided to require that entities disclose an aggregate
reconciliation of crypto assets, but only for annual periods. That reconciliation
should include separate disclosure of additions, disposals, gains recognized
during the period, and losses recognized during the period.
BC65. The Board decided that gains and losses should be separately
disclosed in the reconciliation because that information allows an investor to
identify whether there are large gains offsetting large losses during the period.
The amendments in this Update also specify that gains and losses should be
determined on a crypto-asset-by-crypto-asset basis to increase the
consistency and comparability of that information between reporting entities.
The Board observed that the disclosure of gains and losses may indicate
unique circumstances related to a particular crypto asset or that an entity has
changed its strategy.
BC66. An entity is required to provide a description of the additions (for

example, purchases, receipts from customers, or mining activities) and
dispositions (for example, sales or payment for services) as part of the
reconciliation or in its annual disclosures. The Board noted that the information
about the nature of additions and dispositions helps investors more easily
identify and analyze noncash transactions involving crypto assets.
BC67. The amendments in this Update also require that an entity disclose the
cumulative realized gains and cumulative realized losses resulting from crypto
asset disposals that occurred during the period. The gains and losses
41
represent the difference between the disposal price and the cost basis of those
assets. Some investors noted that a disclosure of this nature would provide
them with useful information about an entity’s effectiveness over the
management of its crypto assets.
BC68. The Board decided that an entity need not include within the
reconciliation activity related to crypto assets received as noncash
consideration in the ordinary course of business (or as a contribution, in the
case of a not-for-profit entity) that are converted nearly immediately into cash.
The Board supported this exemption because disclosing that activity may not
provide investors with decision-useful information because those entities have
no ongoing risk exposure to crypto assets, even if that activity was significant
during the period.
BC69. The Board acknowledged that the Private Company Decision-Making

Framework indicates that private companies generally should not be required
to disclose a reconciliation of the beginning and ending balances of balance
sheet line items. The Board received mixed feedback from comment letter
respondents and Private Company Council members about requiring this
disclosure for private companies. However, those that supported this
disclosure stated that it would provide relevant information for private company
investors and would allow an investor to understand an entity’s crypto asset
activities during the reporting period. Stakeholders told the Board that a
disclosure of this nature may not be costly because crypto asset recordkeepers
currently are tracking the information that would be necessary to provide the
reconciliation. As a result, the Board decided not to have a different
requirement for private companies.
Disclosures Considered but Rejected

feedback received from stakeholder outreach for other suggested disclosures
about crypto assets that could be useful, including additional information about
gains and losses, the nature and purpose of holding crypto assets, information
about pricing, and information about the cryptographic private key. In some
cases, the Board observed that similar information is not currently required for
similar assets and could be obtained by the disclosure of the reconciliation, by
the disclosure about significant holdings, or from other existing disclosure
requirements. For other suggested disclosures, the Board decided that the
42
information to be disclosed was too detailed. A majority of comment letter
respondents agreed with the Board’s rationale and some commented that
additional disclosures could be provided by entities on a voluntary basis.
Therefore, the Board decided not to require those additional disclosures.
BC71. Some comment letter respondents suggested additional disclosures

for the Board’s consideration. However, the Board decided not to require those
additional disclosures because they duplicate existing requirements or are not
within the scope of the amendments in this Update.
Effective Date and Transition

BC72. The Board decided that the amendments in this Update are effective
for fiscal years beginning after December 15, 2024, including interim periods
within those fiscal years, for all entities. Consistent with feedback from
investors and preparers, the Board decided that early adoption is permitted,
including adoption in an interim period as of the beginning of the annual period
that includes that interim period or in an annual period as of the beginning of
that annual period.
BC73. A majority of comment letter respondents indicated that they would not
incur significant implementation costs or need a significant amount of time to
apply the amendments in this Update because (a) entities currently apply Topic
820 when evaluating crypto assets for impairment and (b) some entities are
currently providing similar information to their investors on a voluntary basis.
Therefore, the Board concluded that the effective date should provide sufficient
time for entities to understand and apply the amendments. Additionally, nearly
all respondents who provided feedback on whether early adoption should be
permitted indicated that it should be permitted.
BC74. Some comment letter respondents provided feedback on whether

entities other than public business entities would need more time than public
business entities to implement the amendments in this Update. Half of those
respondents indicated that entities other than public business entities should
have a deferred effective date to learn from the implementation experiences of
public business entities. The other half of respondents indicated that all entities
should have the same amount of time to implement the amendments because
all entities currently need to apply the guidance in Topic 820 when evaluating
crypto assets for impairment. Additionally, based on respondents’ feedback,
the Board anticipates that many entities will early adopt the amendments,
43
which will provide examples of financial statements and disclosures that may
be useful for other entities adopting the amendments in this Update.
Considering that, as well as the effective date and that entities currently apply
Topic 820 in evaluating the impairment of crypto assets, the Board decided not
to provide a different effective date for entities other than public business
entities.
BC75. The amendments in this Update require a cumulative-effect

adjustment, including the direct effects of that adjustment such as tax
consequences, to the opening balance of retained earnings (or other
appropriate components of equity or net assets) as of the beginning of the
annual period in which an entity adopts the amendments.
BC76. Nearly all comment letter respondents supported those transition

requirements. However, a few respondents commented that they would
support an option or requirement for entities to apply the amendments in this
Update on a full retrospective basis. Those respondents commented that full
retrospective application would improve comparability and may not be costly.
Other respondents supported not requiring full retrospective application
because it would be complex and costly and would provide investors with
limited incremental information.
BC77. The Board decided against requiring that reporting entities apply the
amendments in this Update through a full retrospective approach, or providing
an option for entities to do so, because it concluded that the expected costs of
full retrospective application may not justify the potential expected benefits for
investors. The Board agreed with comment letter respondents who said that
full retrospective application could be complex and costly and would provide
investors with limited benefits, given continuous changes in the fair value of
those crypto assets.
BC78. The Board also considered, but rejected, prospective application of the
amendments in this Update, which would have resulted in recognizing the
effects of initially applying the amendments through net income. In doing so,
the decision usefulness of information provided to investors could have been
diminished because those effects would have been presented with any gains
or losses that may arise from subsequently measuring crypto assets in the
period of adoption.
44
BC79. Consistent with feedback from investors and preparers, the Board
decided that early adoption is permitted, including adoption in an interim period
as of the beginning of the annual period that includes that interim period.
Comparison to International Financial Reporting

Standards Accounting Standards (IFRS Accounting
Standards)
BC80. In June 2019, the IFRS Interpretations Committee (IFRIC) clarified that
cryptocurrencies (a subset of crypto assets that have certain characteristics
that differ from the scope of the amendments in this Update) held for sale in
the ordinary course of business should be measured at the lower of cost and
net realizable value in accordance with IAS 2, Inventories, unless the asset
holder is a commodity broker-trader, in which case the cryptocurrencies should
be measured at fair value less costs to sell. All other holdings of
cryptocurrencies should be accounted for in accordance with IAS 38, Intangible
Assets.
BC81. IAS 38 requires impairment testing of intangible assets, which is

similar to current GAAP. However, unlike current GAAP, impairment losses
may be reversed under certain circumstances. In addition, entities may elect to
carry an intangible asset with an active market at a revalued amount, which is
its fair value at the date of revaluation less any accumulated impairment losses
that are recognized after the revaluation date. IFRS Accounting Standards
require that any changes in fair value above historical cost be recognized in
other comprehensive income, while any changes in fair value below historical
cost should be recognized in profit and loss.
BC82. There are similarities between the amendments in this Update and the
IFRS Accounting Standards revaluation model. One important similarity is that
for crypto assets traded in active markets, if entities elect to apply the
revaluation model in IAS 38, both require recognition of crypto assets at fair
value on the balance sheet. There also are four key differences between the
amendments and IFRS Accounting Standards. Those differences are that:
a. The amendments apply to a subset of crypto assets that differ from
cryptocurrencies as described by the IFRIC.
b. The amendments require fair value measurement for crypto assets (a
subset of intangible assets), whereas the revaluation model under
IFRS Accounting Standards is an election for intangible assets.
45
c. The amendments require fair value measurement for crypto assets,
whereas the revaluation model under IFRS Accounting Standards
requires reference to an active market for measuring at fair value.
d. The amendments require the recognition of all remeasurements of
crypto assets in net income, whereas IFRS Accounting Standards
require recognition of any gains above original cost in other
comprehensive income without recycling to net income.
BC83. Additionally, the amendments in this Update require disclosures that

are specific to crypto assets that are not included in IFRS Accounting
Standards.
46
Amendments to the GAAP Taxonomy
The amendments to the FASB Accounting Standards Codification® in this
Accounting Standards Update require improvements to the GAAP Financial
Reporting Taxonomy and SEC Reporting Taxonomy (collectively referred to as
the “GAAP Taxonomy”). Those improvements, which will be incorporated into
the proposed 2024 GAAP Taxonomy, are available through GAAP Taxonomy
Improvements provided at www.fasb.org, and finalized as part of the annual
release process.
47

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Intangibles—Goodwill and Other—

Accounting for and Disclosure of Crypto Assets

An Amendment of the FASB Accounting Standards Codification®

Copyright © 2023 by Financial Accounting Foundation. All rights

Intangibles—Goodwill and Other—

Accounting for and Disclosure of Crypto Assets

An Amendment of the FASB Accounting Standards Codification®

Financial Accounting Standards Board

Intangibles—Goodwill and Other—Crypto Assets

Accounting for and Disclosure of Crypto Assets

Summary ............................................................................................ 1–4

Why Is the FASB Issuing This Accounting Standards

In addition to better reflecting the economics of crypto assets, measuring those

Who Is Affected by the Amendments in This Update?

What Are the Main Provisions?

An entity is required to subsequently measure assets that meet those criteria

While the amendments in this Update do not otherwise change the

How Do the Main Provisions Differ from Current

When Will the Amendments Be Effective and What

The amendments in this Update require a cumulative-effect adjustment to the

Addition of Subtopic 350-60

[For ease of readability, the new Subtopic is not underlined.]

Intangibles—Goodwill and Other—Crypto Assets

Overview and Background

350-60-05-1 This Subtopic provides guidance on the subsequent

350-60-05-2 This Subtopic does not address the initial measurement,

Scope and Scope Exceptions

> Overall Guidance

a. Meet the definition of intangible assets as defined in the Codification

An unconditional transfer of cash or other assets, as well as unconditional

A contribution that contains a donor-imposed condition.

A donor stipulation (donors include other types of contributors, including

Fair Value (second definition)

A contribution that results if an entity voluntarily transfers assets (or net

Intangible Asset Class

An entity that possesses the following characteristics, in varying

A written or oral agreement to contribute cash or other assets to another

Related parties include:

Unconditional Promise to Give

A promise to give that depends only on passage of time or demand by the

Other Presentation Matters

> Statement of Financial Position

350-60-45-1 Crypto assets shall be presented separately from other intangible

> Income Statement

> Statement of Cash Flows

350-60-45-3 For guidance related to the presentation of cash receipts arising

350-60-50-1 At interim and annual reporting periods, an entity shall disclose

350-60-50-2 At annual reporting periods, an entity shall disclose both of the

350-60-50-3 At annual reporting periods, an entity shall provide a

350-60-50-5 An entity that receives crypto assets as noncash consideration in

350-60-50-7 In providing the required disclosures in paragraph 350-60-50-6,

Transition and Open Effective Date Information

350-60-65-1 The following represents the transition and effective date

Amendments to Subtopic 230-10

Statement of Cash Flows—Overall

Other Presentation Matters

• > Acquisitions and Sales of Certain Securities Securities, and Loans,

230-10-45-21A Cash receipts resulting from the sale of donated financial