SEC Staff Accounting Bulletin No. 122 is United States SEC staff accounting guidance issued on January 23, 2025 and effective January 30, 2025. SAB 122 rescinds Section FF of Topic 5 in the SEC Staff Accounting Bulletin Series, which had addressed accounting for obligations to safeguard crypto-assets held for platform users. The bulletin should be treated as published SEC staff guidance, not enacted legislation or a standalone authorization for crypto custody.
What SAB 122 changes for crypto-asset safeguarding
SAB 122 removes the prior Topic 5.FF guidance that had been added by SAB 121. Instead of the SAB 121 staff view that generally required a safeguarding liability and corresponding asset presentation for in-scope crypto-assets held for platform users, SAB 122 instructs entities with obligations to safeguard crypto-assets for others to analyze whether a liability related to risk of loss should be recognized under existing contingency standards.
For U.S. GAAP filers, the bulletin points to FASB ASC Subtopic 450-20, Loss Contingencies. For IFRS Accounting Standards, it points to IAS 37, Provisions, Contingent Liabilities and Contingent Assets. SAB 122 also reminds entities to continue considering disclosure requirements that help investors understand obligations to safeguard crypto-assets held for others.
Key provisions
- Rescission of Topic 5.FF: SAB 122 removes the SAB 121 crypto-asset safeguarding topic from the Staff Accounting Bulletin Series.
- Contingency analysis: Entities should evaluate whether to recognize and measure a loss-risk liability using applicable contingency accounting standards.
- Retrospective application: Entities should apply the rescission fully retrospectively in annual periods beginning after December 15, 2024.
- Early application election: Entities may apply the rescission in earlier interim or annual financial statement periods included in Commission filings after SAB 122’s effective date.
- Change-in-accounting disclosures: Entities should clearly disclose the effects of a change in accounting principle when initially applying the rescission.
- Continuing disclosure reminders: The SEC staff points to Regulation S-K Items 101, 105, and 303, FASB ASC 450-20, and FASB ASC Topic 275.
Jurisdictional impact in the United States
For U.S. crypto law coverage, SAB 122 is important because it changes the SEC staff accounting position applicable to many SEC reporting and filing contexts involving crypto-asset safeguarding. It does not itself create a bank, broker-dealer, exchange, transfer-agent, trust-company, state money-transmission, or bankruptcy-law regime. Those questions remain governed by separate laws, rules, and supervisory frameworks.
The SEC states that staff accounting bulletins are not Commission rules or Commission interpretations and are not published as bearing Commission approval. They represent interpretations and practices followed by the Division of Corporation Finance and the Office of the Chief Accountant in administering federal securities-law disclosure requirements.
Status and timeline
| Date | Event | Status |
|---|---|---|
| March 31, 2022 | SEC staff issued SAB 121 on obligations to safeguard crypto-assets held for platform users. | Published |
| April 11, 2022 | SAB 121 became effective and was published in the Federal Register. | Effective |
| October 31, 2023 | GAO concluded SAB 121 was a rule for Congressional Review Act purposes. | Published |
| July 11, 2024 | H.J. Res. 109, the CRA resolution to disapprove SAB 121, failed to pass over presidential veto. | Failed |
| January 23, 2025 | SEC dated SAB 122, rescinding Topic 5.FF. | Published |
| January 30, 2025 | SAB 122 became effective and was published at 90 FR 8492. | Effective |
As of June 4, 2026, this profile should classify SAB 122 as published and effective SEC staff accounting guidance for crypto-asset safeguarding disclosure and contingency analysis.