According to the ECB (European Central Bank), cryptocurrencies are a digital representation of value that is not issued by a central bank or other public authority.
This opinion is also supported by the BNB, although there are opinions regarding cryptocurrencies, there is no legal definition of cryptocurrency in our country. Therefore, since banking authorities in Europe do not consider cryptocurrencies to be cash or their equivalent, we can assume that this activity is not subject to mandatory registration.
The point is that if, in addition to cryptocurrencies, you also trade in financial instruments and other currency, in this case your activity will be subject to registration as an investment intermediary or as an exchange office.
According to the adopted changes in the GDPR and money laundering measures, it is necessary to have a system for working with personal data – GDPR, which meets the requirements of the law. These systems are not subject to registration and approval, but it is necessary to have them and comply with the requirements laid down in them.
As traders of cryptocurrencies (possibly other currencies and financial instruments), you need to have rules developed in relation to the Law on Anti-Money Laundering Measures, as well as documents for the identification of your counterparties, in cases where this is required by the Law.
Cryptocurrency trading. As we said above, cryptocurrencies are not considered cash and cash equivalents, therefore you do not need to be a member of such a fund. Cryptocurrency transfers are not made through central bank settlement precisely because banks do not consider them to be cash.
In connection with the more serious spread of cryptocurrencies and the different opinions on how they should be accounted for in accounting, at its meeting on 12.06.2019, the IFRS Clarifications Committee took a decision on the treatment of cryptocurrencies.
The Committee proposes two ways of accounting for them – as tangible stocks or as intangible assets. The proposal is that cryptocurrencies that are purchased for trading purposes should be considered inventory (goods), and this is your case.
Those that have a specific issuer or carry with them contractual rights should be excluded from the scope as cryptocurrencies accounted for as commodities, in which case they should be accounted for as financial instruments.
Given the nature of cryptocurrencies (traded on exchanges), they should be assumed to be exchange commodities and accounted for as such. Upon initial recognition (purchase), they should be valued at acquisition cost, and subsequently be valued at fair value, according to their stock market price.
Regarding the question of the prices of which exchange you should use for fair value assessment – this is your personal decision. You should, when developing your accounting policy for accounting for cryptocurrencies, decide which exchange prices you will use and apply them consistently for at least two accounting periods.
If you change the exchange on the basis of which you determine the fair value of cryptocurrencies, you should apply a recalculation of your statements, as with a change in accounting policy.
If you use only one exchange through which you buy and sell, then naturally its prices will be the basis for calculating the fair value. Nowadays, we are witnessing an avalanche-like spread of various types of crypto–assets, and in our country, undoubtedly, the largest share of them still have the so-called cryptocurrencies.
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