The Financial Accounting Standards Board (FASB) is updating how digital assets are treated under US GAAP, according to a report by Cbiz. Recently, the board moved toward clearer and more practical rules for classifying and reporting these assets. At its April 15 meeting, the board decided to expand its crypto asset guidance to include instruments like wrapped tokens. These tokens give holders the right to receive another crypto asset and are similar to assets already covered by current rules.  

FASB is also preparing guidance to clarify when certain digital assets, especially stablecoins, can be treated as cash equivalents. Rather than changing the definition, the board will give examples that highlight key factors such as redemption rights and the quality of reserves. The guidance says that qualifying assets must be backed by “high-quality assets that are readily convertible to cash” and have a one-to-one reserve structure, allowing holders to redeem them directly and at any time.  

The proposals also add detailed disclosure rules for cash equivalents for all companies. Firms would need to report balances by major categories, making their liquidity positions clearer. While these decisions are still tentative, they reflect a broader effort to bring more consistency and clarity to this fast-changing area.