Fair value of Cryptographic assets

Fair value of Cryptographic assets

The fair value of a cryptographic asset (‘CA’) might be accounted for or disclosed in financial statements. Fair value might be needed in a variety of situations, including:

Inventory of cryptographic assets held by a broker-trader applying fair value less costs to sell accounting

Expense for third party services paid for in cryptographic assets

Cryptographic assets classified as intangible assets in cases where the revaluation model is used

Expense for employee services paid for in cryptographic assets

Revenue from the perspective of an ICO issuer

Cryptographic assets acquired in a business combination

Disclosure of the fair value for cryptographic assets held on behalf of others

Cryptographic assets held by an investment fund (either measured at fair value or for which fair value is disclosed)

IFRS 13, ‘Fair Value Measurement’, defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date”, and it sets out a framework for determining fair values under IFRS.

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IFRS 13 understand inputs to valuation techniques

Overview  IFRS 13 understand inputs to valuation techniques

  • Inputs to valuation techniques are the assumptions that would use in pricing the asset or liability.
  • Inputs are categorized into three levels (Read more

    Market-corroborated inputs

    Market-corroborated inputs are inputs to fair value calculation models that are derived principally from observable market data by correlation or other means.

    Fair value hierarchy

    To increase the consistency and comparability in fair value measurements, IFRS 13 (paras 72-90) established a fair value hierarchy of level 1, 2 and 3 inputs