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Korea Accounting Institute Considers Classifying Virtual Currencies into Liquid Assets
Accounting Standard for Crytocurrencies
Korea Accounting Institute Considers Classifying Virtual Currencies into Liquid Assets
  • By Michael Herh
  • February 22, 2018, 02:00
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The Korea Accounting Institute is considering a plan to classify crytocurrencies such as Bitcoin into liquid assets in financial statements.
The Korea Accounting Institute is considering a plan to classify crytocurrencies such as Bitcoin into liquid assets in financial statements.

 

The Korea Accounting Institute said on February 21 that the institute is considering a plan to classify crytocurrencies such as Bitcoin into liquid assets in financial statements. The institute can, however, allow them to be classified into non-current assets depending on the purposes and periods (one or more years) of holding them.

In addition, their value as an asset will be fair value in the case of crytocurrencies with active markets where price information is reliable as the market has high transaction volume and transaction frequencies but historical cost will be regarded as the value of virtual currencies without active markets.

The Korea Accounting Institute added that they were discussing damage treatment methods when the book value of virtual currencies is lower than expected selling prices.

This discussion about a virtual currency accounting standard was had at the request of Bithumb, a December settlement corporation, among virtual money market exchanges. Bithumb is an exchange that is subject to the External Audit Act along with Korbit and Coinone. "A virtual currency accounting standard is still in the draft stage. We need to discuss more about it," said an official of Korea Accounting Institute said. "We will prepare the virtual currency accounting standard by next month."