Bernstein: After adopting the new accounting standards, Strategy's balance sheet will increase by $12.75 billion

ChainCatcher news, according to The Block, research firm Bernstein's latest analysis shows that Strategy (formerly MicroStrategy) will see its balance sheet increase by $12.75 billion after adopting the new fair value accounting standards from FASB. Previously, the value of digital assets on the company's books had to account for impairment losses when prices fell, but if prices rose, they could not be adjusted upward unless sold.

Starting January 2025, Strategy will adopt the new fair value accounting rules from the Financial Accounting Standards Board (FASB), which will result in a one-time cumulative adjustment of $12.75 billion being recorded in retained earnings at the beginning. Bernstein analyst Gautam Chhugani stated in a report to clients on Thursday that this change will allow the company to recognize unrealized gains on its Bitcoin positions for the first time.