FASB Proposes Guidance That Would Let Companies Count Qualifying Stablecoins as Cash Equivalents

Stablecoins with one-to-one liquid reserves, disclosed annually, and on-demand redemption could join Treasury bills in the cash equivalents line under FASB’s proposal.

The Financial Accounting Standards Board issued a proposed accounting standards update on Tuesday that would clarify when digital assets qualify as cash equivalents under U.S. generally accepted accounting principles. The practical effect is that a qualifying stablecoin could sit in the same balance sheet line as Treasury bills, commercial paper and money market funds.

The definition itself is not changing. FASB would add illustrative examples under the cash flow statement guidance showing which assets clear the bar: a contractual right to redeem on demand directly with the issuer for a known cash amount, segregated reserves of at least one-to-one held in short-term highly liquid assets, and annual disclosure of those reserves. A separate part of the proposal would require any entity presenting cash equivalents to disclose their significant components annually, a requirement that applies whether or not the company touches crypto. Comments are due Nov. 19, and the board will decide the effective date after reviewing them.

This story is an excerpt from the Unchained Daily newsletter.

Under current practice, one company can treat USDC as cash-like while another books it as an other asset, which distorts working capital comparisons across the same sector and makes stablecoin payments an accounting exercise rather than a treasury decision. Clearing that up removes one of the more mundane but persistent obstacles to public companies holding tokenized dollars for anything beyond a pilot.

The pressure runs the other way for issuers. A cash-equivalent test built on reserve quality, segregation and on-demand redemption effectively rewards issuers that can document all three, and leaves anything with a lockup, a redemption gate or opaque backing on the outside. Circle pushed for the project during FASB’s agenda consultation, and President Trump’s digital asset working group recommended in its July 2025 report that FASB consider treating payment stablecoins as cash equivalents.

FASB added the project to its technical agenda after taking it up last October and voted in April to draft the proposal. It builds on the board’s 2023 standard requiring companies to measure bitcoin and other crypto assets at fair value, guidance that pointedly excluded stablecoins and non-fungible tokens. The accounting is arriving alongside the statutory framework: the GENIUS Act became law in July 2025, and Treasury proposed rules on who may issue and distribute payment stablecoins on Monday.

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