bitcoin
Bitcoin (BITCOIN)
$114,742 0.37%
ethereum
Ethereum (ETHEREUM)
$3,672 3.12%
binancecoin
BNB (BINANCECOIN)
$764.23 0.93%
solana
Solana (SOLANA)
$170.69 5.10%
ripple
XRP (RIPPLE)
$3.07 2.82%
shiba-inu
Shiba Inu (SHIBA-INU)
$0.000012 0.53%
pepe
Pepe (PEPE)
$0.000011 1.57%
bonk
Bonk (BONK)
$0.000026 -2.86%
bitcoin
Bitcoin (BITCOIN)
$114,742 0.37%
ethereum
Ethereum (ETHEREUM)
$3,672 3.12%
binancecoin
BNB (BINANCECOIN)
$764.23 0.93%
solana
Solana (SOLANA)
$170.69 5.10%
ripple
XRP (RIPPLE)
$3.07 2.82%
shiba-inu
Shiba Inu (SHIBA-INU)
$0.000012 0.53%
pepe
Pepe (PEPE)
$0.000011 1.57%
bonk
Bonk (BONK)
$0.000026 -2.86%
bitcoin
Bitcoin (BITCOIN)
$114,742 0.37%
ethereum
Ethereum (ETHEREUM)
$3,672 3.12%
binancecoin
BNB (BINANCECOIN)
$764.23 0.93%
solana
Solana (SOLANA)
$170.69 5.10%
ripple
XRP (RIPPLE)
$3.07 2.82%
shiba-inu
Shiba Inu (SHIBA-INU)
$0.000012 0.53%
pepe
Pepe (PEPE)
$0.000011 1.57%
bonk
Bonk (BONK)
$0.000026 -2.86%
Disclosure
Cryptocurrency trading is speculative and your capital is at risk when you trade. We may earn affiliate commissions from some of the products on this page - at no extra cost to you.
SEC Issues Stablecoin Accounting Rules for Cash Equivalents: Report

Highlights:

  • SEC’s updated stablecoin accounting rules now allow qualifying U.S. dollar-pegged tokens to be treated as cash equivalents.
  • Stablecoins with full cash or Treasury backing, a 1:1 U.S. dollar peg, and guaranteed redemption rights are now eligible for cash classification.
  • The move marks a key regulatory shift that may encourage traditional financial institutions to increase their exposure to crypto assets.

The U.S. Securities and Exchange Commission (SEC) has released interim guidance on how companies should deal with stablecoins. According to a report by Bloomberg Law, stablecoins that are 1:1 pegged with the U.S. dollar and have a full redemption contract are to be reported as cash equivalents.

Advertisement

Banner

The step is one of the overall efforts to redesign crypto regulation. Paul Atkins, the chair, is spearheading multiple reforms, which are meant to eliminate outdated restrictions. In the past, companies were not able to treat stablecoins as cash, restricting traditional participation in digital assets. The new regulations only refer to those stablecoins that are backed by USD and provide guaranteed redemption. Such tokens also have to be fully supported by cash or U.S. Treasury bills. This will not include algorithmic or yield-bearing coins and any others that lack transparency.

New Rules Bring Accounting Clarity

Fully backed and redeemable stablecoins, according to the SEC, pass the tests of cash equivalents. They can now be included next to standard cash holdings on the balance sheet of the companies. This latest move comes in as an update to earlier guidance in April. The SEC at the time stated that it did not consider “covered” stablecoins to be securities. It also established that there was no need to register with the agency for the issuance and redemption of these tokens.

The agency clarified that only stablecoins, which have consistent value and clear reserves, could be considered. The move provides companies with a way to make crypto accounting easier and raises financial reporting transparency.

Reforms Encourage Institutional Involvement

The new stablecoin accounting rules are part of the agency’s broader initiative, “Project Crypto.” This project proposes modernizing securities regulation to align more with blockchain-based finance. Moreover, Atkins initiated the project based on the suggestions of the President’s Working Group.

According to the financial market experts, this guidance can be viewed as a crucial measure toward the future of digital assets in corporate finance. Bernstein Research stated that it could put the U.S. in a better position in global crypto regulation. This guidance also complements the GENIUS Act, which was signed in July. That law sets reserve and audit requirements for regulated stablecoins. Furthermore, the joint developments will seek to make digital dollars legitimate in the financial system.

This may directly benefit companies such as Tether and Circle, which have models that fit the requirements. The SEC believes that the step will stimulate the further entry of traditional financial players into the space. Banks and corporations can now comfortably hold stablecoins since the regulatory friction regarding them is now reduced.

Although the change provided by the SEC is not a comprehensive rule change, it is an indication of a significant trend change. The interim stablecoin accounting rules are expected to be a stepping stone to permanent policy updates. Clarity in classification could reduce legal uncertainties, which will help improve the accuracy of the financial reports.

eToro Platform

Best Crypto Exchange

  • Over 90 top cryptos to trade
  • Regulated by top-tier entities
  • User-friendly trading app
  • 30+ million users
9.9

5 Stars

eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk. Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment, and you should not expect to be protected if something goes wrong.

Advertisement

Banner

Advertisement

Banner

Advertisement

Banner