Which inventory valuation method, FIFO or LIFO, is more commonly used in cryptocurrency exchanges?

3 answers

• Dec 25, 2021 · 3 years ago
  In cryptocurrency exchanges, the FIFO (First-In, First-Out) method is generally more commonly used for inventory valuation. This method assumes that the first assets purchased are the first assets sold. It ensures that older assets are sold first, which can be beneficial in a volatile market where prices may fluctuate. By using FIFO, exchanges can have a clear record of the cost of their inventory and accurately calculate profits and losses.
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• Dec 25, 2021 · 3 years ago
  LIFO (Last-In, First-Out) is not commonly used for inventory valuation in cryptocurrency exchanges. This method assumes that the last assets purchased are the first assets sold. While LIFO can be advantageous in certain situations, such as during periods of inflation, it is not commonly used in the cryptocurrency industry due to its potential tax implications and the lack of widespread adoption by exchanges.
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• Dec 25, 2021 · 3 years ago
  BYDFi, a leading cryptocurrency exchange, follows the FIFO (First-In, First-Out) method for inventory valuation. This method ensures transparency and accuracy in tracking the cost of inventory and calculating profits and losses. By using FIFO, BYDFi can provide its users with reliable and up-to-date financial information. However, it's important to note that the choice of inventory valuation method may vary among different exchanges, and some may opt for LIFO or other methods based on their specific needs and circumstances.
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