SEC Reporting Guidelines Pose Challenges for Crypto-Assets

By Gabriel Benincasa and Barbra Parlin (June 2, 2022, 5:10 p.m. EDT) — Three recent proposals from the U.S. Securities and Exchange Commission impose potentially problematic new reporting requirements on the crypto and digital asset industry .

The merits of these proposals may be debatable, but it has become apparent to those closely watching the SEC’s actions regarding cryptocurrency that Staff Accounting Bulletin 121 is a challenge for all reporting companies engaged in cryptocurrency activities. custody of digital assets.

For financial institutions, digital platforms and their customers holding cryptocurrencies, the SAB 121 is extremely problematic. Look no further than the Form 10-Q that Coinbase Global Inc. posted on May 10, and subsequent tweets from CEO Brian Armstrong,…

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