How duality plays out

When a trader uses crypto, the balances seem like they simply move from one place to another. Just like with cash, even across currencies, the focus is on overall balances and FX remeasurement. You don’t track which specific unit of currency was used.

Nuances arise because each unit carries its own acquisition cost and timestamp. Under ASC 350, crypto holdings are classified as intangible assets, so any operational use such as funding a trade, paying fees, or posting collateral is treated as a disposal event that triggers gain or loss recognition. When a trader uses crypto to fund a trade or settle a position, that specific history becomes relevant for accounting. For example, commission received in ETH or a position funded in BTC gets treated as a lot and matched to its cost basis. You have to recognize a gain or loss, and timing matters. As a result, routine treasury workflows involve not just tracking balances but also identifying which specific units were used, something cash operations typically don’t require.

The problem with single views

These differing perspectives matter when systems are built around a single interpretation of an asset.

In many workflows, crypto is treated as a balance that moves by funding trades, paying fees, and reallocating across venues. From that perspective, activity is continuous and fungible. At the same time, each use of crypto involves specific units acquired at different times and prices, which determine accounting outcomes. The same transaction must therefore be understood both as a movement of value and as the use of particular units with cost and history.

A single-view system can represent one of these interpretations well, but not both simultaneously. If activity is captured only at the balance level, the unit-level detail needed for accounting must be derived later. If it is captured only at the asset level, it does not reflect how that balance is actually used in operations.

Consider a portfolio manager preparing to fund a position using BTC. She sees an available balance and treats it as a liquid resource that can be deployed immediately. That view is operationally correct because decisions are made based on what is available to use.

At the same time, that action draws from specific BTC units acquired over time, each with its own cost. The decision itself does not depend on those details, but the outcome does. What appears as a single balance in operations must also be understood as a composition of units for accounting.