The Financial Accounting Standards Board has proposed guidance that could let some stablecoins qualify as cash equivalents under US accounting rules. At the same time, Visa and Mastercard are expanding their stablecoin settlement strategies.
The proposal would add examples to the existing definition of cash equivalents without changing that definition. FASB said the update aims to address inconsistent accounting treatment for digital assets such as stablecoins.
Under the proposal, a digital asset would need an on-demand contractual redemption right. Holders would also need a direct right to redeem the asset with its issuer for a known cash amount. The issuer would need to maintain at least one-to-one segregated reserves. Those reserves would need to consist of short-term and highly liquid assets.
FASB also provided examples of assets that would not qualify. An active secondary market alone would not satisfy the requirements when holders lack a direct issuer redemption right.
A token backed by crypto assets and gold would also fail the test because those reserves carry valuation risks. Companies could still decide whether to present qualifying assets as cash equivalents. They would also need to consider relevant laws and regulations. FASB is accepting public comments on the proposed update until November 19.
Meanwhile, Visa has started seeking proposals from potential partners for stablecoin settlement and over-the-counter trading, according to CoinDesk. The company wants firms with crypto exchange licenses in several major markets.
Those markets include the United States, Canada, the United Kingdom, and Singapore. The selected partner would support swaps between multiple stablecoins and help settle Open USD, or OUSD.
OUSD counts Stripe, Visa, and Mastercard among its backers. The project aims to provide a compliant and fully reserved stablecoin for enterprises and regulators. Visa also launched its Visa Stablecoin Platform last month. The platform targets financial institutions and fintech companies that want to custody and settle stablecoins.
The service seeks to connect traditional financial systems with stablecoin infrastructure. It also gives Visa a larger role in regulated digital asset settlement. What happens if accounting clarity and payment infrastructure develop at the same time?
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Mastercard has also expanded its stablecoin strategy through its acquisition of BVNK that provides infrastructure for businesses to issue, accept, and settle digital currencies. By integrating BVNK, Mastercard aims to give partners a simpler route into stablecoin payments. That approach places it in direct competition with Visa's settlement platform.
Both payment companies are targeting a market that increasingly uses stablecoins for cross-border payments, remittances, and treasury operations. They are also focusing on regulated infrastructure and licensed counterparties.
The involvement of Stripe, Visa, and Mastercard in OUSD shows growing institutional participation in stablecoin projects. OUSD targets enterprise use while maintaining full reserves and compliance. FASB will determine an effective date for its accounting update after reviewing stakeholder feedback. Its consultation remains open until November 19.
FASB has proposed conditions for treating some stablecoins as cash equivalents, while Visa and Mastercard are expanding stablecoin settlement infrastructure. The developments place redemption rights, reserves, licensing, accounting treatment, and payment integration at the center of the growing stablecoin market.