The U.S. Securities and Exchange Commission (SEC) issued interim guidance on August 5, 2025, permitting certain U.S. dollar-backed stablecoins to be classified as cash equivalents on corporate balance sheets. This landmark decision applies exclusively to stablecoins meeting stringent criteria: full backing by cash or Treasury bills, a consistent 1:1 dollar peg, and a guaranteed redemption right for holders.
The guidance explicitly excludes algorithmic stablecoins, yield-bearing tokens, and non-dollar-pegged assets. SEC Chair Paul Atkins spearheaded this initiative as part of 'Project Crypto,' marking a reversal from previous restrictive policies and addressing key accounting barriers that deterred institutional participation. Bloomberg Tax reported this aligns with the GENIUS Act signed by President Trump in July 2025, which mandates reserve requirements and audits while formally recognizing regulated stablecoins as distinct financial instruments.
Major stablecoin issuers like Circle (USDC) and Tether (USDT) gain clearer regulatory pathways, potentially accelerating corporate adoption for treasury management. However, the SEC noted unresolved risks—including redemption uncertainties and transparency gaps—and emphasized this as interim guidance pending further rulemaking. Analysts view this as a critical step toward integrating digital assets into mainstream financial reporting frameworks.