August 12, 2020

The IFRS Committee recognized cryptocurrencies as an intangible asset

The International Financial Reporting Standards Committee (IFRIC) has recognized that cryptocurrencies do not represent cash or financial assets, but are classified as intangible assets.

IFRIC sets international standardsfinancial statements (IFRS) and is a fairly influential body in the international financial system. The organization issued a document recognizing that cryptocurrencies fit the definition of intangible assets.

According to the IFRIC report, intangible assets -these are non-monetary assets without physical embodiment. Also, cryptocurrencies are not securities, as they do not give the holder contractual exchange rights. Accountants separately emphasized that cryptocurrencies do not apply to cash, since in practice they do not participate in the trade in goods and services.

Note that the document only reflects the opinion of the Committee and is not a rule for countries using IFRS.

Interestingly, the state of New York recognized Bitcoin as intangible property at the end of 2014. In June this year, a similar bill was signed by the Governor of Nevada.

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