The Financial Accounting Standards Board received hundreds of letters inspired by MicroStrategy that urge U.S. accounting standards be reconsidered to accommodate companies that hold Bitcoin.

The Financial Accounting Standards Board received hundreds of letters inspired by MicroStrategy that urge U.S. accounting standards be reconsidered to accommodate companies that hold Bitcoin, Bloomberg reported.

MicroStrategy recently wrote to the Financial Accounting Standards Board (FASB), “This disconnect between an entity’s financial statements and the economic reality of its financial condition and results of operations creates confusion and fails to provide investors, analysts, and the general public with the information they need to make an informed assessment of an entity’s current and future prospects.”

Currently companies that aren’t investment companies report Bitcoin as intangible assets. This means Bitcoin gets recorded on balance sheets at its historic cost and is then impaired if the value dips. Although, the value can never be revised upward if the price of Bitcoin increases.

Notably, FASB doesn’t change rules based on the number of letters it receives, but the volume points to a clear consensus among businesses holding Bitcoin in reserve and other interested parties: The current regulations fail to provide investors with clear information about a company’s financial prospects, especially as they relate to Bitcoin.

Among those who wrote to FASB to urge them to take action were the big four accounting firms, an American Institute of CPAs panel, some investor groups, and individual businesses. The requests were in response to FASB’s call for input on its long-term agenda. Comments were due on 22 September.

The Alliance of Concerned Investors wrote, “We recommend that the FASB begin a project on accounting for digital assets immediately; waiting until they become pervasive in financial reporting may put the FASB so far behind, they may never catch up.”

FASB has rejected previous calls to revise accounting standards for Bitcoin, claiming most companies don’t have significant holdings, and that if they accept the currency as payment, they immediately convert it to cash, Bloomberg reported. However, some major companies have doubled down on their Bitcoin investments, including MicroStrategy and Square, and they’re not selling.

Early in September, MicroStrategy CEO Michael Saylor announced that the firm purchased an additional 5,050 Bitcoin for about $242.9 million in cash during the third quarter period.

Since August 2020 MicroStrategy has purchased and held approximately 114,042 Bitcoin, acquired at an aggregate purchase price of $3.16 billion and an average price of $27,713 per bitcoin, inclusive of fees and expenses. The firm owns more Bitcoin than any other public company in the world.

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