TLDR
- FASB proposes allowing certain stablecoins to qualify as cash equivalents under US GAAP.
- Eligible stablecoins would need full liquid reserve backing.
- Qualifying tokens must be redeemable for US dollars on demand.
- Issuers would need to provide annual reserve disclosures.
- Public comments on the proposal remain open until November 19, 2026.
The Financial Accounting Standards Board has proposed new guidance that could allow certain stablecoins to qualify as cash equivalents under U.S. generally accepted accounting principles. The proposal seeks to clarify how companies account for qualifying digital assets without changing the existing definition of cash equivalents.
Under the proposed Accounting Standards Update, eligible stablecoins would need to meet conditions tied to reserves, redemption, and disclosure. The proposal remains open for public comment until November 19, 2026, and has not yet become part of U.S. GAAP.
Stablecoins Could Qualify as Cash Equivalents
The FASB proposal provides examples showing how the current cash-equivalent definition could apply to certain digital assets. Stablecoins could qualify when they are backed by liquid reserves worth at least as much as the tokens in circulation and can be redeemed for U.S. dollars on demand.
Issuers would also need to provide annual information about their reserves. Those conditions are intended to help companies assess whether a stablecoin has the liquidity and value stability normally associated with assets presented as cash equivalents.
Cash equivalents generally include short-term, highly liquid assets that can be converted quickly into known amounts of cash. Common examples include certain U.S. Treasury securities, commercial paper, and money market instruments.
The proposal does not create a separate accounting category for stablecoins. FASB instead aims to show how existing accounting rules can apply when a digital asset has characteristics similar to other highly liquid financial assets.
FASB Targets Different Stablecoin Accounting Practices
FASB says companies have faced uncertainty over whether stablecoins meet the existing definition of cash equivalents. That uncertainty has led businesses to use different accounting methods for similar digital assets, reducing consistency between financial statements.
The accounting board began receiving more feedback about digital assets through its 2025 agenda consultation process. Companies and other stakeholders asked for greater clarity on how stablecoins should appear on corporate balance sheets and cash-flow statements.
The proposed examples would apply to entities holding certain digital assets, while the broader disclosure requirements would cover all companies that report assets as cash equivalents. Businesses would need to provide more detail about the major components and amounts included in their cash-equivalent balances.
FASB says the additional disclosure would give investors and other users of financial statements clearer information about what companies classify alongside cash. The requirement would apply even when a company holds no digital assets.
Public Comment Period Runs Through November 19
The proposal forms part of FASB’s broader work on accounting treatment for digital assets. The board began developing crypto-specific accounting guidance in 2023 as corporate ownership and use of digital assets increased.
The latest proposal focuses narrowly on stablecoins and similar digital assets that may meet existing cash-equivalent requirements. Stablecoins that fail the reserve, redemption, or disclosure conditions would not automatically qualify under the proposed examples.
FASB has not finalized the guidance and could revise the proposal after reviewing public feedback. Companies, investors, auditors, and other stakeholders can submit comments through November 19.
The next step comes after the consultation closes, when the FASB will review responses and determine whether to proceed with a final Accounting Standards Update. Until that process is completed, existing U.S. GAAP treatment remains in place.
