The path to accessing the capital markets includes a step up to rigorous public company reporting requirements. This can be a big lift for any company, to meet the complex, dynamic, and time-consuming U.S. generally accepted accounting principles (GAAP), International Financial Reporting Standards (IFRS), and SEC reporting. But for companies operating in the cryptocurrency industry, as it is still in its infancy, there are additional evolving accounting considerations to contend with on the journey to going public. While crypto assets reporting and disclosure requirements under U.S. GAAP apply to all companies, it’s especially important to maintain compliance if you’re preparing for the heightened scrutiny of the IPO process.

As digital assets become increasingly integrated into business operations, U.S. GAAP continues to evolve to address their unique characteristics. To guide the accounting for and disclosure of crypto assets, the Financial Accounting Standards Board (FASB) issued ASU 2023-08(Opens a new window), effective for fiscal years beginning after Dec. 15, 2024, introducing Subtopic 350-60, Intangibles — Goodwill and Other — Crypto Assets. The AICPA’s “Accounting for and auditing of digital assets” practice aid(Opens a new window), last updated September 2025, offers additional guidance. 

This article outlines key – but not all – considerations for holders, miners, and lenders of cryptocurrency, based on published guidance and industry practices. If you have additional questions, or are considering enhancing your crypto reporting for a potential IPO, please contact our CFO Advisory team.

Note: CohnReznick LLP does not currently audit cryptocurrency reporting.

Holding crypto assets

Under ASU 2023-08, crypto assets are classified as in-scope crypto intangible assets if they meet specific criteria:

• Fungible
• Secured by cryptography
• Residing on a distributed ledger based on blockchain or similar technology 
• Not created or issued by the reporting entity or its related parties 
• Meet the definition of intangible assets as defined in the Codification 
• Do not provide the asset holder with enforceable rights to or claims on underlying goods, services, or other assets

Holdings of in-scope crypto intangible assets are presented separately from other intangible assets on the balance sheet and subsequently measured at fair value, with gains and losses from the remeasurement recorded in net income, separately presented from changes in the carrying amounts of other intangible assets in the income statement. 

For crypto intangible assets that are not in scope, a determination needs to be made as to whether they have a finite or indefinite life. 

• An indefinite-lived out-of-scope crypto intangible asset is initially carried at the value determined in accordance with FASB ASC 350-30-30-1 and is not subject to amortization. Rather, it should be tested for impairment annually, or more frequently if events or changes in circumstances indicate it is more likely than not that the asset is impaired. After the impairment loss is recognized, the adjusted carrying amount becomes the new accounting basis of the intangible asset.

Mining and mining pools

The AICPA practice aid takes a close look at how entities operating as miners should recognize and measure related earnings.

Transaction fees earned by a miner are generally recognized under ASC 606, Revenue from Contracts with Customers. The requester (participant who requested the transaction) meets the definition of a customer under ASC 606 “because it has contracted with the miner to obtain a service (successful mining) that is an output of the miner’s ordinary activities in exchange for consideration,” the practice aid states. “… By successfully mining a block, the miner satisfies its performance obligation to the requester and, thus, should recognize revenue at that point in time.” The payment of transaction fees in crypto intangible assets constitutes noncash consideration.

“Block rewards earned by a miner are generally recognized as revenue, but an evaluation is required to determine if the block rewards earned should be recognized as revenue from contracts with customers under FASB ASC 606 or as other revenue,” the practice aid states. “…Because there is no specific guidance that applies to revenues from block rewards, a miner could apply by analogy the revenue recognition guidance in FASB ASC 606 to recognize and measure the revenue from block rewards.”

Accounting for mining pools that includes sharing of computing infrastructure as part of a pool run by another operator could require evaluation for lease considerations under ASC 842, Leases. If the arrangement with the operator does not include a lease, the next step is to evaluate who is the customer for the computing services: the operator or the blockchain participants? 

• If it is determined that the computing services are provided to the operator, an entity should evaluate whether its mining pool arrangement with the operator is a contract with a customer under ASC 606 or other appropriate accounting, including whether it is appropriate to apply ASC 606 by analogy. 
• If the determination is that the computing services are provided to the blockchain participants, they would be accounted for as either transaction fees or block awards for mining services based on the type of arrangement.

Lending digital assets and receivables

U.S. GAAP does not provide explicit guidance specific to the lending of crypto intangible assets, but the AICPA’s practice aid Question 25 offers a relevant example.

When digital assets are loaned to others, the accounting treatment hinges on whether control has transferred from the lender to the borrower. The practice aid states:

Upon derecognition of the lent crypto intangible asset, we understand the SEC staff would not object to a conclusion that the lender would recognize an asset that is reflective of its right to receive the crypto intangible assets from the borrower at the end of the loan period (herein referred to as a crypto intangible asset loan receivable).

The crypto intangible asset loan receivable would be measured at the fair value of the lent crypto intangible assets both initially and at subsequent reporting dates … Any difference between the carrying amount of the derecognized crypto intangible assets and the initial measurement of the crypto intangible asset loan receivable would be presented in the income statement as other gains and losses and not as revenue.

As the crypto intangible asset loan receivable exposes the lender to the borrower’s credit risk, the lender should also consider the need to recognize an allowance for any expected credit losses related to the receivable, utilizing the principles in FASB ASC 326, Financial Instruments – Credit Losses.

Custodial arrangements and control

Determining whether an entity maintains control over crypto assets held by a custodian is critical for balance sheet presentation. Control is generally assessed based on the ability to direct the use of and obtain substantially all the benefits from the asset.

Determining whether the depositor or the custodian has control of the digital asset should be based on the specific facts and circumstances of the agreement, the practice aid states. Factors to consider include, but are not limited to:

• Applicability of legal or regulatory frameworks that could specify legal ownership
• The obligation or otherwise of the custodian to transfer the depositor’s original units of the digital asset deposited
• The custodian’s rights to sell, transfer, loan, encumber, or pledge the deposited digital asset for its purposes without depositor consent or notice
• Protection of the digital assets from the custodian’s creditors in the event of bankruptcy, liquidation, or dissolution of the custodian
• The depositor’s ability to withdraw at any time
• Any side agreements affecting the rights and obligations of the depositor and the custodian
• Any “off-chain” transactions recorded outside of the blockchain 
• Whether the digital asset is held in a multi-signature wallet and what digital signatures are required to execute the transaction, including who has access to the private keys
• Who bears the risk of loss if the deposited digital assets are not retrievable by the custodian

If the depositor is determined to have control over the digital asset, then the depositor should recognize the asset in its financial statements. 

If the custodian is determined to have control, the depositor should recognize a right to receive the digital asset from the custodian as an asset.

Conclusion

The evolving landscape of digital assets demands a nuanced understanding of U.S. GAAP. Whether holding, mining, or lending crypto assets, entities must carefully assess classification, measurement, and control. ASU 2023-08 provides the principles for the initial and subsequent measurement, but additional guidance across other areas of U.S. GAAP, such as revenue recognition, receivables, and custodial arrangements, is essential for accurate and transparent financial reporting. As adoption grows, staying current with regulatory developments will be key to maintaining compliance and investor confidence.

And, of course, reporting is not the only consideration when going public; the process requires careful planning and cross-functional teamwork around governance, technology, and more. Compliance with Sarbanes-Oxley regulations for internal controls over financial reporting may take on heightened importance – and complexity – when cryptocurrency is involved. 

Companies involved with cryptocurrency should consider augmenting their in-house resources with external specialists to help them make the IPO leap. CohnReznick’s CFO Advisory team stands ready to help you adopt and meet these dynamic requirements. Reach out to learn more.