Ridgeway Financial Services supports crypto-native and Web3 companies with technical accounting memos that address the evolving application of U.S. GAAP to digital assets, token-based ecosystems, on-chain activity, and regulatory complexity. These memos help management document key judgments, structure financial statements properly, and ensure consistency across reporting periods. This list summarizes the common scenarios where Ridgeway Financial Services prepares memos for clients. Contact us for assistance.

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Digital Asset Classification & Measurement

For a full breakdown of how each digital asset activity is treated under current U.S. GAAP and federal tax law, activity by activity, see our reference on digital asset accounting and tax treatment.

1. Crypto Asset Classification (ASC 350-60)
   Why it matters: Under ASC 350-60, effective for fiscal years beginning after December 15, 2024, in-scope crypto assets are measured at fair value through net income each period. Tokens that fail the scope criteria may still be intangible assets under ASC 350.
   Memo includes: In-scope versus out-of-scope determination, classification rationale, fair value and disclosure requirements.
2. Fair Value Measurement and Disclosures (ASC 350-60)
   Why it matters: In-scope crypto assets are remeasured to fair value each period, replacing the older cost-less-impairment model, with separate presentation and enhanced disclosures.
   Memo includes: Price source hierarchy, remeasurement timing, significant holdings and annual rollforward disclosures, cost-basis method.
3. Assets Outside ASC 350-60 Scope
   Why it matters: Wrapped tokens, receipt tokens, tokens with enforceable rights to other assets, and self-issued tokens fall outside ASC 350-60 and follow other GAAP. FASB tentatively decided in April 2026 to bring some wrapped and receipt tokens into scope.
   Memo includes: Scope analysis, applicable alternative GAAP, monitoring of pending FASB changes.
4. NFT Valuation and Accounting
   Why it matters: NFTs are outside ASC 350-60 because they are not fungible, and may be treated as intangibles, inventory, or contract-related assets depending on context. Creator sales and royalties may fall under ASC 606.
   Memo includes: Asset purpose, unit of account, revenue recognition or impairment approach.
5. Stablecoin Holdings
   Why it matters: May qualify as cash equivalents, or sit inside or outside ASC 350-60 depending on redemption rights. FASB is developing cash-equivalent classification guidance, with tentative decisions in April 2026.
   Memo includes: Redemption rights, reserve backing, issuer risk, cash-equivalent analysis.

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Revenue Recognition & Token Flows (ASC 606)

6. Token Sales / ICOs
   Why it matters: May represent deferred revenue or financial liability.
   Memo includes: Performance obligation identification, breakage, legal form vs substance.
7. Staking Rewards Revenue
   Why it matters: Often the primary revenue stream.
   Memo includes: Principal vs agent, performance obligation, valuation of token rewards.
8. Transaction Fees and Protocol Revenue
   Why it matters: On-chain services (e.g. validators, bridges) earn fees in tokens.
   Memo includes: Revenue recognition timing, non-cash consideration.
9. Mining Rewards
   Why it matters: Treated as revenue when earned.
   Memo includes: Block reward timing, valuation at receipt.
10. Marketplace or Exchange Fees
    Why it matters: Determines revenue recognition and principal vs agent classification.
    Memo includes: Smart contract control, custody, counterparty role.
11. Airdrops and Token Grants Received
    Why it matters: May be income, contribution, or equity.
    Memo includes: Timing of recognition, valuation, performance conditions.

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Token Issuance & Liabilities

12. SAFT Agreements (Simple Agreements for Future Tokens)
    Why it matters: May be deferred revenue or liability.
    Memo includes: Obligation evaluation, redemption or refund features, delivery expectations.
13. Treasury Token Classification
    Why it matters: Company-issued tokens may be liability, equity, or deferred revenue.
    Memo includes: Use case, control retention, obligation to holders.
14. Token Warrants or Token-Based Compensation (ASC 718 by analogy)
    Why it matters: Tokens granted to employees or advisors require expense recognition.
    Memo includes: Grant date, vesting schedule, valuation, service-based or performance-based terms.
15. Governance or Utility Tokens with Embedded Rights
    Why it matters: May contain derivatives or settlement features.
    Memo includes: Token design, host vs embedded feature analysis under ASC 815.
16. Token Buyback or Burn Programs
    Why it matters: May trigger liability extinguishment or equity reduction.
    Memo includes: Substance of repurchase, accounting treatment.

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Consolidation, Control & Structures (ASC 810)

17. DAO Involvement or Consolidation
    Why it matters: If the company controls a DAO, consolidation may be required.
    Memo includes: Power and benefit analysis, VIE status.
18. Foundation and Treasury Entity Relationships
    Why it matters: Foundations may house token treasuries or IP.
    Memo includes: Voting/control rights, benefit flows, consolidation under ASC 810.
19. Joint Ventures and Protocol Affiliates
    Why it matters: For shared control over new L2s, tools, or ecosystems.
    Memo includes: Equity method vs consolidation determination.

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Custody, Risk, and Compliance

20. Crypto Custody Treatment (SAB 122)
    Why it matters: SAB 122 rescinded SAB 121 in January 2025, so entities no longer gross up a safeguarding asset and liability on the balance sheet, and instead apply existing GAAP such as ASC 450 to the safeguarding obligation.
    Memo includes: Custodial responsibility, legal ownership, liability recognition under existing GAAP, disclosure.
21. Safeguarding Obligations
    Why it matters: May trigger a separate liability for tokens held for customers.
    Memo includes: Nature of custody, segregated wallets, liability vs agency view.
22. On-Chain Wallet Reconciliation
    Why it matters: Required to support audit assertions.
    Memo includes: Reconciliation methods, DeFi activity matching, smart contract reporting.

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Other Relevant Areas

23. Going Concern Evaluation
    Why it matters: High volatility can threaten liquidity runway.
    Memo includes: Treasury runway, stablecoin exposure, operational burn.
24. Fair Value Hierarchy for Illiquid Tokens
    Why it matters: Level 3 estimates require support.
    Memo includes: Market activity, OTC pricing, valuation models.
25. Environmental or Energy Usage Disclosures
    Why it matters: Required or expected for mining-intensive businesses.
    Memo includes: Emissions estimates, energy use per token mined.

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This is not an exhaustive list. If you are facing a unique or complex accounting matter not shown here, reach out to us. Ridgeway Financial Services is happy to help. Contact us.