Evaluating custody of digital assets
Hot Topic | February 2024
We explore accounting ownership of custodied digital assets, and when custody affects revenue recognition.
In this Hot Topic, we explain how an entity assesses the accounting owner of custodied digital assets and when custody is a performance obligation under ASC 606.
Applicability
All entities that either:
- Engage unrelated custodians to hold their digital assets; or
- Act as a digital asset custodian
Relevant dates
- Effective immediately
Topics addressed:
- Accounting ownership of digital assets purchased through a custodial wallet
- Accounting ownership of digital assets recognized by the depositor before transfer to a custodian
- Identifying custodial performance obligations under the revenue standard (ASC 606)
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Evaluating custody of digital assets
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