“Bitcoin and cryptos are not currency or legal tender”, international accounting committee, IFRIC says

Korea Accounting Institute (KAI) announced a new standard by IFRIC on cryptocurrencies and their place on accounting record keeping as intangible assets.

A directive by the International Financial Reporting Interpretations Committee (IFRIC) in a meeting this June, labelled cryptocurrency assets as “intangible assets”. According to a report on Korean Times, the global accounting regulator – associated with the International Financial Reporting Standards (IFRS) Foundation under the International Accounting Standards Board (IASB) – does not consider the digital assets as currencies or tangible assets.

Over 140 countries follow the accounting practices put forward by the committee and bookkeepers across the world are expected to follow the latest international standard. However, the standard is set to open up a long standing debate among crypto business operators following their recognition of crypto as a currency.

Cryptocurrencies are Lintangible Assets

IFRIC report on cryptocurrencies states the digital assets are neither legal tender nor a financial asset. It further states the asset is neither a form of cash nor equity. Furthermore, the statement reads,

“They [cryptocurrencies] do not give rise to a contractual right for the holder and it is not a contract that will or may be settled in the holder's own equity instruments.”

As a separable asset – an asset that can be

“separated from the holder and sold or transferred individually and it does not give the holder a right to receive a fixed or determinable number of units of currency,”

– Bitcoin and other cryptos are labelled “intangible assets” for accounting purposes.

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Lujan Odera
Lujan Odera
Lujan is a blockchain technology and cryptocurrency author and editor. He has worked in the field of cryptocurrencies and blockchain technology since 2015 helping him gain enough experience to be the writer he is today. He is known for his simple writing style that allows novices to understand the field in the simplest way.

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

[Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer

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