The accounting bodies FASB and IASB, which are influential at international level, do not believe in the continued existence of crypto currencies. The reason: Bitcoin and Co. are too seldom actually used but margin trading and gambling with BTC are very popular. What prevents further adaptation? Lack of regulation, such as by the FASB and IASB.
Missing standards for crypto currencies
Although Bitcoin has been around for over ten years and since its creation many more crypto currencies have seen the light of day, the issue of regulation has been largely ignored by the major accounting bodies. In December 2018, Hans Hoogervorst, Chairman of the International Accounting Standards Board (IASB), which sets global accounting standards, said: “It usually takes the IASB five years to develop a new accounting standard… and I expect crypto currencies to have disappeared by the end of that time. So it wouldn’t be worth the time and effort to invest in necessary standards if they don’t continue, as Hoogervorst believes. Nevertheless BTC is changing the world and it becomes a part of many industries like sports betting. If you want to change your fiat money to btc, you need a reliable exchange!
However, in a letter to the US Financial Accounting Standards Board (FASB), the Californian Association of Accountants (CalCPA) now demanded that the necessary legally binding rules be laid down by which accountants can orient themselves with regard to crypto currencies. Once such accounting rules have been established, it will be much easier for auditors to provide their clients with expert advice in the still relatively young field of cyberdevisen. Furthermore, Nancy Rix of CalCPA is convinced that “crypto currencies will not disappear over time”, but instead “will continue to grow in volume and application areas”.
Cyberdevisen suffer from inadequate adaptation
- However, FASB Chairman Russell Golden joins the ranks of cryptosceptics.
- In his opinion, the problem with digital assets is that there are still too few companies working with them.
- The actual use of Bitcoin and Co. is still too low. However, the adaptation of crypto currencies is significantly hindered by the lack of international standards.
Change of heart?
In order to change this, the IFRS Foundation, which belongs to the IASB, met a few days ago in London. Here a final position on the topic of cyberdevisen was to be found as an orientation aid for auditors worldwide. The majority recommended to the board to set standards for crypto currencies and to treat them as intangible assets. In addition, the Foundation offered three definitions of cyberdevisen. After this meeting it could therefore be that the topic of standards for crypto currencies will still be on the move.