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How is there an impairment loss when fair value is in excess of carrying value? This query is from the Bitcoin Impairment loss of Block (SQ) from their recent Annual Report.
Bitcoin impairment losses of $71.1 million were recorded in the year ended December 31, 2021 due to the market price of bitcoin decreasing below the carrying value of our bitcoin investment during the period. As of December 31, 2021, the fair value of our investment in bitcoin was $371.0 million based on observable market prices, which is $222.1 million in excess of the carrying value of our investment of $149.0 million. Any unrealized gains on our bitcoin investment will only be recognized upon the sale of such bitcoin investment.
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