Bitcoin's poised to boost public companies

Driving the news: A new cryptocurrency accounting standard from the Financial Accounting Standards Board was finalized yesterday.

• It has a mandatory effective date of Dec. 31, 2024, but folks who adopt the guidance early can apply it for their fiscal 2023 year-end reports.
• That means bitcoin holders from MicroStrategy to Block (formerly Square) can recognize losses — and gains — immediately.

What they're saying: MicroStrategy founder and chairman Michael Saylor said the news "will facilitate the adoption of $BTC as a treasury reserve asset by corporations worldwide."

Yes, but: The standard doesn't apply to all digital assets.

Between the lines: "FASB wanted to define it specifically and somewhat narrowly," PJ Theisen, an Audit & Assurance partner at Deloitte, tells Axios.

• "Entities will have to go through the scoping criteria and think hard about whether an asset meets each of these criterion and talk to their auditors."

Details: Qualified assets can't provide their holder with enforceable rights to, or claims on, underlying goods, services or other assets.

• They have to be created or live on a blockchain and secured through cryptography.
• They have to be fungible. (No NFTs.)
• And they can't be created or issued by the reporting firm or related parties.

What we're watching: The new standard comes with a "disclosure package," per Theisen, which means investors will have the benefit of seeing apples-to-apples numbers from company to company.

• "Prior to the finalization, there was no disclosure guidance specifically addressing crypto assets, so some companies were disclosing more than others."

The bottom line: That's good news for investors.