Executive Summary

With the arrival of the Financial Accounting Standards Board’s ASU 2023-08, the accounting playbook for cryptocurrency has undergone a material change. Rather than treating crypto as an intangible asset carried at cost — only written down if impaired — companies must now re-value qualifying holdings at fair market value each reporting date, with gains or losses flowing through net income.

For businesses using QuickBooks Online, this raises a significant challenge. QuickBooks Online does not natively support fair-value re-measurement for crypto, nor can it generate required disclosures. Many finance teams end up juggling spreadsheets, manual journal entries, and fragmented audit trails — a recipe for errors and compliance risk.

The workaround is a hybrid system: track initial purchase in QuickBooks Online, then export holdings to a spreadsheet that pulls price data, computes fair-value adjustments, and auto-generates journal entries. Tools like FinBoard.ai make this approach practical even for small-mid-market companies with modest crypto exposure. In this guide, we walk you through how to build this workflow, illustrate real-world cases, surface common pitfalls, and show how to stay audit-ready with minimal disruption.

 What changed: From impairment to fair-value

Before December 2023, most U.S. companies holding crypto treated it under the same rules as other indefinite-lived intangible assets (per ASC 350). The asset was recorded at cost; if market value dropped below cost, an impairment was recorded. But increases in value weren’t recognized — even if price later recovered.

That changed with the issuance of ASU 2023-08, introducing Subtopic ASC 350-60: Crypto Assets. The ruling requires all in-scope crypto (see scope criteria below) to be measured at fair value at each reporting date, with gains or losses flowing into net income. dart.deloitte.com+2arch.bdo.com+2

Scope criteria (asset qualifies if):

• It meets the GAAP definition of an intangible asset (non-physical, no contractual right to cash flows)

• It does not provide enforceable claims on goods, services or other assets

• It resides on a distributed ledger (blockchain)

• It is secured via cryptography

• It is fungible (common tokens like BTC, ETH)

• It is not issued by the reporting entity or related parties arch.bdo.com+1
  
  

Assets that meet this definition must be presented separately from other intangibles on the balance sheet, and fair-value changes must be shown separately from goodwill or other intangible-asset adjustments. KPMG+1

If adoption begins in 2025, companies must pass a “cumulative-effect adjustment” into retained earnings for the difference between the old cost basis and new fair-value basis at conversion date. BDO+1

Why QuickBooks Online on its own falls short

QuickBooks Online was designed long before crypto became a meaningful corporate asset class. Its chart of accounts, templates, and workflows do not reflect needs like:

• Periodic fair-value re-measurement
  
  

• Tracking multiple wallets or exchanges
  
  

• Maintaining historical acquisition costs + units + transaction dates
  
  

• Automatic calculation of unrealised gain/loss and adjustment entries
  
  

• Disclosure schedule generation (cost basis, units held, “as-of” market value)
  
  

Manual spreadsheets bring several risks:

• Human error when copying transactions or price data
  
  

• Missing re-measurements in busy month-end close
  
  

• No audit trail linking crypto wallet to GL entries
  
  

• Inconsistent disclosures — often omitted or incomplete
  
  

• Difficulty scaling if transaction volume grows
  
  

Building a scalable crypto-accounting workflow

If you hold crypto — even just modest amounts — a hybrid workflow combining QuickBooks Online + Google Sheets + a tool like FinBoard.ai is often the most pragmatic path. Here is how to build it.

Step 1. Use QuickBooks Online for initial purchase

• When you buy crypto, treat it like you would buy any intangible.
  
  

• Debit “Crypto Asset — Digital Currency” (or similar), credit “Cash / Bank” (cost basis).

Step 2. Maintain wallet or exchange ledger outside QuickBooks Online

• Export CSV or API data from your wallet/exchange. Include: date, token, quantity, USD price, transaction ID.
  
  

• Store in Google Sheets.

Step 3. Use FinBoard.ai to fetch live prices & compute fair value

• Every period (monthly / quarterly) run sheet: FinBoard.ai pulls the latest price for each coin.
  
  

• Multiply quantity × price → compute “Market Value as of [date]”.
  
  

• Compare with previous period’s book value → compute unrealised gain (or loss).
  
  

Step 4. Journal entry for market re-measurement

• Debit or Credit “Crypto Asset – Fair Value Adjustment” (asset side)
  
  

• Credit / Debit “Unrealised Gain/Loss – Crypto” (income statement)
  
  

Step 5. Maintain audit trail & disclosure schedule

• Store snapshot of ledger, price data, and entry as supporting documents.
  
  

• Keep a disclosure sheet summarising: token name, units held, cost basis, fair value, gain/loss per period.
  
  

This approach brings several benefits:

• Reliable, repeatable re-measurement — no risk of skipped entries.
  
  

• Clean audit trail linking wallet history → ledger entries → P&L.
  
  

• Disclosure schedule ready for financial statements or investor reporting.
  
  

• Scalable as holdings grow.
  
  

Comparison: Spreadsheet-only vs Spreadsheet + FinBoard.ai

Real-world scenarios & case studies

Case A — Startup holding crypto as treasury reserve
Situation: A small SaaS startup accepted payment in Bitcoin. Over the year it accumulated 5 BTC at an average cost of $40,000/BTC. End-2024 price: $42,000. End-2025 price: $65,000.

Prior to ASU 2023-08: The startup recorded 5 BTC at $200,000, no further entries unless impairment.
Post-ASU with hybrid workflow:

• Jan 2025 (adoption): mark to fair value: debit Crypto Asset +65,000; credit Retained Earnings (cumulative adj).
  
  

• Each quarter-end: adjust fair value: gains flow to “Unrealised Gain – Crypto”.
  
  

Result: P&L now reflects economic reality. Audit trail kept in Sheets + QuickBooks Online ledger.

Case B — SaaS firm receiving crypto as customer payment
Situation: A SaaS company allows subscription payment in ETH. In March 2025, customer pays 10 ETH when ETH = $3,000. Company converts to USD immediately but still holds small ETH buffer.

• Record initial receipt: Debit Cash (USD after conversion), credit Revenue.
  
  

• For ETH buffer: treat as crypto asset, apply fair-value re-measurement each period.
  
  

On disposal or conversion, record realized gain or loss versus book value. This provides full transparency for both cash and crypto exposures.

Case C — Trading firm with frequent crypto transactions
Situation: A firm trades crypto actively (dozens of buys/sells weekly). Using QuickBooks Online alone becomes chaotic — ledger bloats, manual errors creep in, and reconciliation becomes nightmarish.

Hybrid workflow helps: central wallet ledger in Google Sheets tracked via FinBoard.ai; periodic aggregate posting to QuickBooks Online (e.g., daily or weekly). Maintains liquidity, avoids clutter, and ensures audit readiness. For very high volume, a specialised sub-ledger system may be better.

Typical pitfalls — and how to avoid them

Pitfall 1: Skipping re-measurement
Solution: Build re-measurement into month-end close checklist; treat like depreciation or FX-gain entries.

Pitfall 2: Mixing crypto with other intangibles
Solution: Use clear account naming (e.g. “Crypto Asset – BTC”) and ensure separate balance-sheet line item.

Pitfall 3: Losing track of units or wallets
Solution: Maintain central wallet ledger with unique IDs; snapshot before and after each movement.

Pitfall 4: No disclosure documentation
Solution: Maintain “Crypto Disclosures” tab in the spreadsheet: token, units, cost basis, period-end fair value, method, significant assumptions.

Pitfall 5: Exchange price gaps or data feed failure
Solution: Save historical price feed locally; if feed fails, revert to an exchange’s publicly quoted price for the reporting date.

Mini-Case (QuickBooks-centric walkthrough)

Scenario: SaaS company gets paid 2 BTC on 15 Jan 2025 (BTC price = $45,000). They keep BTC on balance sheet.

• Jan 15: Journal entry — Debit “Crypto Asset – BTC” $90,000; Credit “Deferred Revenue / Sales” $90,000.

• Jan 31 (quarter-end): FinBoard.ai fetches BTC price = $48,000 → value = $96,000. Journal entry: Debit Crypto Asset $6,000; Credit “Unrealised Gain – Crypto” $6,000.

• Apr 15: Convert 1 BTC to USD, price = $50,000 → cash in. Journal entry: Debit Cash $50,000; Credit Crypto Asset $48,000; Credit “Realised Gain – Crypto” $2,000.

All entries tracked in QuickBooks Online, valuation schedule and gain/loss schedule in Google Sheets with timestamp. Audit-ready and clear.

Risks & Mitigations

FAQ

1. Do I really need to recognise unrealised gains/losses if I have not sold the crypto?
   Yes — ASU 2023-08 requires fair-value re-measurement each reporting period, with changes flowing into net income, even if the asset is still held. arch.bdo.com+1
   
   

2. Can I treat crypto as inventory or cash?
   No. Crypto fails the definitions of cash or inventory under GAAP. It is treated as an intangible (digital) asset unless you operate as a crypto broker/investment company. BDO+1
   
   

3. What if I hold very small crypto amounts — do I still need full fair-value accounting?
   Technically, yes. But some small firms adopt practical materiality thresholds. Consult your auditor before de-minimis carve-outs.
   
   

4. Can I use FIFO or average cost for cost-basis if I have multiple purchases?
   Yes — but GAAP requires you to disclose the method used. Maintain a detailed ledger with acquisition dates, units, and cost. KPMG+1
   
   

5. Does using FinBoard.ai violate any GAAP rule?
   No — using spreadsheet automation or sub-ledger tools is acceptable. What matters is that the entries are accurate, timely, and supported by documentation.
   
   

Glossary

• ASU 2023-08: FASB Accounting Standards Update introducing fair-value accounting for certain crypto assets under ASC 350-60.

• Crypto Asset: Fungible digital token residing on a blockchain, secured cryptographically, and not issued by the reporting entity.

• Fair Value: Market-based measurement (e.g., exchange price) at reporting date.

• Impairment (legacy model): Under previous GAAP, cryptos carried at cost; only downward re-valuation allowed.

• Unrealised Gain/Loss: Increase or decrease in value of holdings not yet sold — now required to be recorded under ASU 2023-08.

• Sub-ledger: External or supplemental ledger (often in spreadsheet or other system) used to track transactions and valuations outside main GL.

• Cumulative-effect adjustment: Entry required at transition date to adjust retained earnings when adopting new standard.

• Disclosure schedule: Detailed report showing crypto holdings, cost basis, units, fair value, and valuation method, for auditors and stakeholders.