Improving the accounting and disclosure of crypto assets to provide decision useful information is the goal of FASB Accounting Standards Update (ASU) 2023-08. This study investigates whether firms’ voluntary disclosure about their exposure to cryptocurrency is informative to financial analysts. Applying textual analysis to 8-K filings, I find that the intensity of firms’ crypto-related disclosure is associated with more favorable target price revisions by analysts, but not near-term earnings forecast revisions. These findings imply that analysts perceive firms’ crypto exposure to have a long-term benefit on firm value, but no immediate impact on operational performance. Cross-sectional analyses further show that analyst target price revisions contain more optimism when: 1) firms’ crypto disclosure is related to corporate governance, and 2) firms’ stock returns comove more closely with the cryptocurrency market returns. Finally, I find that analysts’ target price revisions appear to enhance the stock market’s positive reaction to firms’ crypto-related disclosure in 8-K filings. My findings suggest the potential effectiveness of FASB’s ASU for crypto assets.
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