Get a first look at the impact of SEC staff guidance on entities safeguarding crypto assets.
On March 31, 2022, the Securities and Exchange Commission (SEC) released Staff Accounting Bulletin No. 121 (SAB 121), which is effective for current reporting entity financial statements covering the first interim or annual reporting period ending after June 15, 2022. A reporting entity within the scope of SAB 121 must record a liability for its obligation to safeguard crypto assets (safeguarding liability), which is both initially and subsequently measured at the fair value of the safeguarded crypto assets. The entity also would record a corresponding asset (safeguarding asset), measured on the same basis as the safeguarding liability.