Letter to FASB on Accounting for Crypto Assets

Hillary Salo
Technical Director
Financial Accounting Standards Board
801 Maine Ave
P.O. Box 5116
Norwalk, CT 06856-5116
Via email: [email protected]

Dear Ms. Salo:

The American Bankers Association (ABA) welcomes the opportunity to comment on Proposed Accounting Standards Update – Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets (Exposure Draft).

Representing both preparers and users of financial statements, we are pleased in the Board's proposal to improve accounting standards related to crypto assets, as it is responsive to our 2021 recommendation. We believe the current accounting for the crypto assets within the scope of this Exposure Draft, which requires these assets to be carried at the lower of cost or market, often does not reflect the economics of the investment and may be misleading to financial statement users. We agree with the Exposure Draft that these crypto assets should be measured at fair value with changes recognized in net income.

As indicated in the scope of the Exposure Draft and explicitly stated at the Board meeting during which the decision to add the project to the agenda was made, ABA recognizes that liabilities related to the safe guarding of crypto assets are not within the scope of this project. That being said, the Exposure Draft proposes a limited set of crypto assets for which subsequent fair value measurement is appropriate. ABA believes that Board's process in scoping a subset of crypto assets and any resulting amendments to US GAAP should inform the Securities Exchange Commission's (Commission's) guidance including Staff Accounting Bulletin 121 (SAB 121). Specifically, the ABA will likely request the Commission revisit and appropriately limit the scope of digital assets subject to SAB 121.

Our remaining comments and recommendations are included in Appendix A and correspond to the questions posed in the exposure draft.

Thank you for considering our comments. If you need additional information or have questions, please contact me ([email protected]; 202-663-5318).

Sincerely,

Joshua Stein