Crypto & IFRS 13: Fair Value Measurement and the Hierarchy

IFRS 13 does not decide whether to fair-value crypto — the classification does that. It decides how the fair value is measured and disclosed once fair value applies. Actively-traded crypto can be Level 1, but the principal-market and exit-price questions are harder than the headline. This guide is that measurement framework, hedged, because the level and inputs are an auditor judgement.

TL;DR

• IFRS 13 governs how, not whether — it applies when fair value is required/elected for crypto (typically the IAS 38 revaluation model).
• Level 1 = unadjusted quoted prices in active markets for identical assets; preferable where available; major actively-traded crypto can be Level 1 — assessed per asset/market, not assumed.
• Principal market (or most advantageous) determination is genuinely complex for crypto (many venues, differing prices, ~24/7) — needs a documented methodology.
• Disclose: fair value at reporting date, hierarchy level, valuation technique, significant inputs (L2/L3).
• Not identical to US GAAP — ASU 2023-08 FV→net income vs IFRS IAS 38 revaluation + IFRS 13 measurement.
• Level/market/inputs are a fact-specific auditor judgement. Not accounting advice.

When IFRS 13 applies

IFRS 13 governs how fair value is measured and disclosed whenever fair value is required or elected — for crypto, typically the IAS 38 revaluation model (see crypto asset account classification). IFRS 13 does not decide whether to measure crypto at fair value; the classification and model choice decide that. Whether/how it applies is an auditor judgement on the facts.

The hierarchy and Level 1

A major cryptocurrency actively traded on liquid markets can meet Level 1 — but Level 1 requires an active market and an unadjusted identical-asset price, not automatic for every token/market. The level is assessed per asset and per market, auditor-confirmed.

The principal-market problem

IFRS 13 measures fair value using the price in the principal market (or, absent one, the most advantageous market). For crypto this is genuinely complex: the same asset trades on many venues, prices differ across them, and markets effectively never close. Identifying the principal market and the appropriate exit price requires judgement and a documented methodology — see crypto fair value & the principal market. A fact-specific, auditor-confirmed policy, not an obvious number.

Disclosure

For fair-valued crypto, broadly disclose: fair value at the reporting date, the hierarchy level, the valuation technique, and for Level 2/3 the significant inputs. The hierarchy level itself is a required disclosure — the entity must support which level a measurement sits in (see crypto asset disclosure notes). Framework-/fact-specific, auditor-confirmed.

Not the same as US GAAP

Analogous but not identical: US GAAP (ASU 2023-08) = fair value, changes in net income for in-scope crypto; IFRS fair value typically via the IAS 38 revaluation model with IFRS 13 governing measurement. Hierarchy concepts are similar in spirit; the standard applied, change routing, and disclosures follow the entity's actual framework (see IFRS vs GAAP for crypto), auditor-confirmed.

Practical guidance

1. Separate "whether" from "how" — classification decides FV; IFRS 13 measures it.
2. Assess Level 1 per asset and per market — don't assume it from a well-known token.
3. Document a principal-market / exit-price methodology — it is judgemental for crypto.
4. Disclose the hierarchy level and support it; add technique/inputs for L2/L3.
5. Apply the entity's actual framework — IFRS 13 ≠ the US GAAP basis.
6. Confirm level, market, and inputs with your auditor — fact-specific; not accounting advice.

How vendor tools handle fair value

Cryptio and Bitwave capture pricing and produce fair-value figures and supporting records. Confirm the tool lets you configure the price source/principal-market methodology and evidence the hierarchy level — the tool produces the figure; the level, principal market, and inputs are an auditor judgement under IFRS 13.

How Wag3s helps

Wag3s Ledger records the price source, timestamp, and fair value per asset with an audit trail and ERP export, so the IFRS 13 measurement and hierarchy-level position can be evidenced — while the level, principal-market methodology, and inputs stay auditor-confirmed. See the Ledger product page.

Further reading

• Crypto Fair Value & the Principal Market
• IAS 38 Crypto as an Intangible Asset
• FASB ASU 2023-08 Crypto Fair Value
• Crypto Asset Disclosure Notes
• Auditing Crypto Fair Value
• Crypto Realized vs Unrealized Gain Accounts

Sources

• IFRS 13 governs how fair value is measured and disclosed when fair value is required/elected (for crypto, typically the IAS 38 revaluation model); it does not decide whether to fair-value crypto — classification/model choice does
• Level 1 = unadjusted quoted prices in active markets for identical assets, preferable where available; major actively-traded crypto can be Level 1 but it is assessed per asset/market (not automatic)
• IFRS 13 uses the principal market (or most advantageous market) price; for crypto this is complex (many venues, differing prices, ~24/7) requiring a documented exit-price methodology — fact-specific auditor-confirmed policy
• Disclosure includes fair value at reporting date, hierarchy level (a required disclosure), valuation technique, and significant inputs for Level 2/3; IFRS 13 is analogous but not identical to the US GAAP ASU 2023-08 basis — apply the entity's actual framework; not accounting advice