Bitcoin's large impairment losses of #MicroStrategy have given a false impression
Changes to #FASB accounting rules should help companies holding digital assets eliminate the bad optics that impairment losses have created
MicroStrategy (MSTR) will soon be able to report its holdings of #bitcoin $BTC each quarter without having to recognize impairment losses if the price of #criptomoneda falls during the period in question, after the Financial Accounting Standards Board (FASB) voted to change the way it that companies report. its finances, investment bank Berenberg said in a report on Wednesday.
Since adopting its bitcoin acquisition strategy in August 2020, MicroStrategy has reported cumulative impairment losses of $2.23 billion, according to the report.
MicroStrategy's largest impairment loss, of $917.8 million, was recorded in the second quarter of 2022, and the loss featured heavily in news coverage of the earnings, "giving the impression that the company's inherent value been negatively affected when that was not the case," he said. said the bank.
“The change should help MSTR and other companies that hold digital assets eliminate the bad optics that have been created by impairment losses under the rules that FASB has implemented,” analysts led by Mark Palmer wrote.
