This Heads Up discusses the FASB’s recently issued proposed Accounting Standards Update (ASU), Intangibles — Accounting for and Disclosure of Crypto Assets, which would provide guidance on the accounting for and disclosure of certain crypto assets. Currently, an entity must account for crypto assets as indefinite-lived intangible assets in accordance with ASC 350 unless the entity is within the scope of the investment-company guidance in ASC 946 or is a certain type of broker-dealer. Stakeholders have raised concerns that this traditional intangible asset model (1) does not faithfully represent the economics of crypto assets and (2) makes it needlessly complex to recognize impairments by requiring entities to use a crypto asset’s lowest observable fair value within a reporting period. The proposed amendments would address these concerns by requiring an entity to subsequently measure certain crypto assets at fair value. Comments on the proposed ASU are due by June 6, 2023.

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