The Financial Accounting Standards Board (FASB) has proposed guidance on when companies may classify certain stablecoins as cash equivalents under US accounting standards. The proposal requires stablecoins to have on-demand contractual redemption rights directly with the issuer for a known cash amount, as well as at least one-to-one segregated reserves held in short-term highly liquid assets. Secondary-market liquidity alone would not be sufficient to qualify a digital asset. The FASB is accepting public comments on the proposed update until November 19, and an effective date will be set after reviewing stakeholder feedback.
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