Accounting for crypto in the UAE: IFRS treatment, records and audit readiness (2026)

More UAE companies now hold cryptocurrency — as a treasury asset, as trading stock, as payment from customers or as the core of a licensed virtual asset business. The accounting is not a technical detail to leave to the year end. UAE Corporate Tax starts from the accounting profit in the financial statements, so the way crypto is classified and measured decides when gains and losses reach the tax computation. Auditors, banks and, for licensed businesses, regulators all read the same numbers.

This article covers the accounting. Our companion article, Crypto and UAE tax, covers Corporate Tax and VAT.

Is it "cryptocurrency" for IFRS purposes?

There is still no IFRS standard written specifically for crypto. The starting point is the IFRS Interpretations Committee's agenda decision of June 2019, Holdings of Cryptocurrencies. It applies to a cryptocurrency that:

• is a digital or virtual currency recorded on a distributed ledger that uses cryptography for security;
• is not issued by a jurisdictional authority or other party; and
• does not give rise to a contract between the holder and another party.

Bitcoin and ether held directly are typical examples. Many other tokens do not fit all three features, so each type needs its own assessment. A stablecoin whose terms give the holder a contractual right to redeem it from the issuer for cash may be a financial asset under IFRS 9. Tokenised shares or bonds are generally accounted for according to the rights they represent. NFTs, utility tokens and governance tokens need a look at what rights they actually carry.

Classification: intangible asset or inventory

The Committee concluded that cryptocurrency within that description is not cash (it is not yet used as the unit in which goods and services are priced) and not a financial asset (it is not a contractual right to receive cash). It meets the definition of an intangible asset in IAS 38 — unless it is held for sale in the ordinary course of business, in which case IAS 2 Inventories applies.

The classification is a judgement about the business model, documented in the accounting policies and applied consistently. Moving crypto between categories because prices have moved is generally not appropriate; a change needs a genuine change in how the crypto is used.

Measurement under IAS 38

Cost model. Crypto is recognised at cost, including directly attributable transaction costs. Many holders conclude that it has an indefinite useful life, so it is not amortised but tested for impairment at least annually and whenever there is an indication of impairment (IAS 36). A fall in price below carrying amount is generally recognised as an impairment loss in profit or loss. A later recovery can be reversed only up to the original cost. Gains above cost appear only when the crypto is sold or exchanged.

The result is asymmetric: falls in value hit profit straight away, rises do not. Management and investors need to understand this when they read the accounts.

Revaluation model. This is available only if the asset has an active market, and it must then be applied to the whole class. Increases go to other comprehensive income and a revaluation surplus (except to the extent they reverse an earlier loss recognised in profit or loss); decreases go first against that surplus and then to profit or loss. The surplus is not recycled to profit when the asset is sold. The model needs reliable period-end prices and more disclosure, and its interaction with Corporate Tax needs specific analysis.

Measurement under IAS 2

Traders who hold crypto for sale in the ordinary course of business measure it at the lower of cost (FIFO or weighted average, applied consistently) and net realisable value. Broker-traders may instead measure it at fair value less costs to sell, with changes going through profit or loss. Whether a company is a broker-trader is a question of fact — the volume, holding period and purpose of its trading — and not simply a policy choice.

Common transactions and how they are booked

Prices, cut-off and currency

Crypto trades around the clock, so the company needs a written cut-off rule — for example, the price at 23:59 UAE time on the reporting date — and a stated price source. IFRS 13 looks to the principal market, or in its absence the most advantageous market, that the company can access. Using one source for purchases and another for year-end values can lead to audit findings.

Most crypto is priced in US dollars. With the dirham pegged at AED 3.6725 to the dollar, conversion is simple, but the rate and the source still need to be recorded consistently. For VAT, the FTA has issued its own method for converting digital currency values into AED — see the tax article.

Disclosures auditors will expect

• The accounting policy and the significant judgements behind it (IAS 1).
• The IAS 38 or IAS 2 disclosures, as applicable, and IFRS 13 fair value disclosures where crypto is measured at fair value.
• Material price movements after the reporting date, as non-adjusting events where relevant (IAS 10).
• Concentration, custody and counterparty risk where crypto is significant to the business.

Records and controls: what makes crypto audit-ready

• A wallet and account register — every wallet address and exchange account, who controls the keys or log-ins, the custodian and the purpose (treasury, trading, client).
• Complete transaction data — exchange statements or exports and on-chain records, kept in their original form.
• A cost-tracking method — FIFO, weighted average or specific identification, set out in the policy and applied every period.
• A monthly reconciliation of quantities and values per wallet to the general ledger, with differences investigated.
• Key and access controls — no single person able to move company crypto alone, and company wallets never mixed with personal wallets.
• Price evidence for every valuation date, from the stated source at the stated cut-off.

Records support both tax laws and must be kept for the periods they require — seven years after the end of the tax period for Corporate Tax, and at least five years for VAT. See the records the FTA expects you to keep.

Common mistakes

• Booking crypto as cash or a bank balance.
• Marking crypto held under IAS 38 to market through profit or loss.
• Treating token-to-token swaps as non-events.
• Missing staking rewards, airdrops and network fees.
• Paying company expenses from personal wallets, or the reverse, without documentation.
• No cut-off time and no consistent price source.

The standards may change

The International Accounting Standards Board lists cryptoassets among its pipeline research topics, but as at the date of this article it has not started a standard-setting project. Until a new standard is issued, the 2019 agenda decision and the existing standards apply, so policies should be written down now and reviewed each year.

How ProBiz Setup can help you achieve high-quality crypto accounting

Good crypto accounting is a process, not a year-end exercise. We work with you on each part of it:

• Accounting policy. We assess each type of token you hold, document the classification and measurement policy, and share it with your auditor at the start so the approach is agreed before the year end.
• Set-up. We build the wallet and account register, connect exchange and wallet data to a crypto sub-ledger, and map it to your accounting system.
• Monthly bookkeeping. Wallet reconciliations, swaps, fees, staking income and period-end impairment or fair value measurement, booked every month.
• Audit-ready files. Lead schedules, price evidence, reconciliations and draft disclosures prepared for your auditor. We work alongside your auditor; the audit itself is carried out by an independent audit firm.
• Tax built on the same numbers. Corporate Tax computations and VAT treatment that follow from the accounts — see our Corporate Tax and VAT services.
• Catch-up work. If earlier years were never properly recorded, we rebuild them from exchange and on-chain data through catch-up bookkeeping.

If your company holds or trades crypto, tell us how it is used and we will discuss an approach that may suit your business.

Sources: IFRS Interpretations Committee agenda decision Holdings of Cryptocurrencies (June 2019); IAS 38 Intangible Assets; IAS 2 Inventories; IAS 36 Impairment of Assets; IFRS 9 Financial Instruments; IFRS 13 Fair Value Measurement; IFRS 15 Revenue from Contracts with Customers; IAS 1 and IAS 10; IFRS Foundation updates on IASB activities (November 2025 and May 2026); Federal Decree-Law No. 47 of 2022 on Corporate Tax (Articles 20 and 56); Ministerial Decision No. 114 of 2023 on accounting standards and methods.