Public companies holding bitcoin could by early next year start showing how well their investments are paying off, Crystal writes.

Why it matters: A new cryptocurrency accounting standard from the Financial Accounting Standards Board 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.

• MicroStrategy founder and chairman Michael Saylor said the news "will facilitate the adoption of $BTC as a treasury reserve asset by corporations worldwide."

Driving the news: The FASB finalized the update yesterday, which would allow bitcoin hodlers from MicroStrategy to Block (formerly Square) to recognize losses and gains immediately.

• Between the lines: Bitcoin won't just go down on balance sheets anymore — good news given the rally of the last three months.

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

What they're saying: "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.

One place there's no bull market so far: downloads of the top crypto apps, Brady writes.

• It would take a real boom in downloads here in the last weeks of 2023 for Q4 to beat Q3, let alone approach early 2022.

By the numbers: Market intelligence firm Sensor Tower also noted that downloads for Coinbase, Robinhood and Crypto.com apps are down 40% year over year.

• Furthermore, monthly active users for all four shown on the chart is down 27%, year over year, from Q3 2022 to Q3 2023.

The intrigue: Binance, on its back foot all year, has handily led in app downloads, however.

• This squares with the anecdotal message we've been getting all year: Crypto lives on outside the U.S. — especially in Asia.

T-bills, tokenized on the blockchain, could eat into the stablecoin market, Crystal writes.

The big picture: Almost $800 million in U.S. treasuries, bonds and cash-equivalents have been tokenized in the last year.

• That's just a fraction of the $130 billion market cap for dollar-pegged stablecoins, but a still-growing corner of crypto fund management.

Driving the news: Late last month, the Web3 Foundation, the group known for stewarding Polkadot, said it would invest part of its treasury into Anemoy, a real-world asset pool launching natively on Centrifuge Chain with tokenized short-term U.S. treasuries.

What they're saying: "The fact that people held value in stablecoins beyond what they simply needed for their daily activities is simply because there wasn't an alternative on-chain that was risk-free," Lucas Vogelsang, CEO of Centrifuge, tells Axios.

Context: Crypto shops used to hold their assets in stablecoins, but when the macroeconomic environment turned, using dollar-pegged stables meant accepting a 5% annual cost — the yield usually passed on to issuers like Circle or Tether.

• "With that change, everyone's scrambling how to get rid of USDT and USDC and turn it into something that gives you access to the T-bill yield," Vogelsang said.

What we're watching: Vogelsang thinks DAOs and other big crypto businesses will opt to hold their assets in tokenized T-bills in a more meaningful way, with stablecoins largely relegated to short-term trading needs.

• "Stablecoins will stop being a store of value, but still be a medium of exchange because people will trade in stables and store cash in T-bills and other assets," he said.

💭 Crystal's thought bubble: Here is yet another player in decentralized finance (DeFi) taking a more regulated path.

• "We went with a British Virgin Island-regulated fund structure," Vogelsang said, which is designed to protect investors and allow them to get their money back in the event of a fund wind-down.
• "It makes a huge difference from a risk perspective," he said. "T-bills are super low risk, so you don't want to add bankruptcy risk in the issuer."

Flashback: "Remember how nasty the Celsius and FTX bankruptcies are?"

Why not just use ETFs? Tokenized T-bills make more sense for groups like DAOs that "don't exist as legal entities," Vogelsang explained.

• They want their money to be on-chain because it takes three or four hops from a DAO treasury wallet to a Circle or broker account."
• "We can ultimately build a better BlackRock Treasury ETF by automating it," Vogelsang said, adding that tokenizing T-bills also opens up the possibility of using them in other ways.

The intrigue: "I'm already talking to funds that are trying to see if they can, for example, start lending and borrowing against these tokenized T-bills."

What we're watching: How the trend turns if/when the Fed starts to cut.

📺 A crypto-backed organization is campaigning for Sen. Sherrod Brown's attention in Ohio metro areas. (CoinDesk)

🔵 Coinbase International is launching spot crypto trading. (Reuters)

💸 A bankruptcy judge set a hearing for early next year to calculate how much FTX owes its largest creditor, the IRS. (CoinDesk)

Mental math could be a stumbling block for crypto bankruptcy creditors, Crystal writes.

Driving the news: Gemini's Earn customers yesterday received a bankruptcy plan, with a projected recovery of 61% to 100% of funds as of Jan. 19, when Gemini's lending partner, Genesis, filed.

What others are saying: There's a lot — 373 pages — to go through, but some folks are balking at their estimated recoveries because the price of bitcoin has roughly doubled since the bankruptcy started.

• People are displeased because restitution is based on the dollar value of assets back when Earn went bust. Assets that are worth much much more now.
• "VOTE NO" — one person commented on Gemini's post, saying that 61% on the petition date amounts to roughly 31% based on BTC prices now.
• Another wondered, "What happened to the $100 million commitment from the bros?"

Of note: Gemini can continue to pursue the adversary proceeding against Genesis, to recover $1.6 billion in value, according to Gemini.

Yes, but: The New York AG's lawsuit against Gemini, Genesis, DCG and DCG chief Barry Silbert could throw a wrench in that.

• "If the NYAG Action were successful in prohibiting DCG or Gemini from continuing to operate, this may impact the potential to recover proceeds relating to litigation against both DCG and Gemini, as provided for under the Amended Plan," the disclosure plan states.

💭 Thought bubble: 1 BTC = 1 BTC, unless you entrust it to someone else in hopes of getting more bitcoin.

What we're watching: How the votes come in by the 4pm deadline on Jan. 10.