Comment
Author: Admin | 2025-04-28
Redemption at the discretion of the issuer would likely impact the ability to classify the holding as a financial asset. Contractual limitation on redemption based on conditions outside the control of the issuer (e.g., laws that prohibit redemption to those engaged in criminal activity) may require further legal analysis. In determining the classification, we believe a holder should consider: the legal form of the stablecoin,redemption rights,collateralization,counterparty risks,contractual rights, andapplicable laws and regulations. See CA 2.1.3 for the accounting if a stablecoin meets the definition of a financial asset. A stablecoin that does not meet the definition of a financial asset should be evaluated to determine if it is an intangible asset, which is described in CA 1.2. 2.1.3 Accounting for purchases of financial assets If a crypto asset meets the definition of a financial asset, it should be analyzed to determine if it is a debt security under ASC 320, Investments – Debt securities, an equity security under ASC 321, Investments – Equity securities, or a receivable under ASC 310, Receivables. Additionally, ASC 825, Financial instruments, permits fair value accounting for instruments that meet the definition of a financial asset.
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