A simple principle has become established in tax practice regarding tokens: As soon as a price is available on a leading trading platform, it is considered the fair market value. However, the question of whether there is actually a functioning market behind that price is rarely examined.
This is precisely where the problem lies. Cryptocurrencies are traded on a wide variety of centralized and decentralized platforms that differ greatly in terms of structure, transparency, and oversight. Empirical studies show that a significant portion of the reported trading volume may be based on wash trades—that is, transactions in which the beneficial owners on the buyer and seller sides are the same. Such sham transactions generate volume without any tokens actually changing hands. Even for the largest cryptocurrencies, prices sometimes diverge significantly across platforms, indicating manipulative market behavior.
This is of great relevance under tax law. According to the case law of the Federal Supreme Court, fair market value is based on a twofold fiction: the asset must be marketable, and the price must have been determined in accordance with customary practices between independent third parties. A price based on wash trading or shallow market depth does not meet these requirements. If it is nevertheless accepted without verification, values that do not exist in economic terms may be subject to taxation. While real estate is conservatively valued and restricted employee stock options are recorded at a discount, tokens are at risk of systematic overvaluation. Such a practice is incompatible with the principle of uniformity of taxation under Art. 127(2) of the Federal Constitution.
As a solution, the article proposes a verification framework for platform prices, which was developed by the authors based on IFRS 13 and a valuation framework presented by the CFA Institute. When applied to tax law, this results in a clear hierarchy: Only in the case of an active, undistorted market can the platform price be adopted as is. If there are doubts, it must be adjusted through appropriate discounts or a volume-weighted average price. In the absence of a viable market, independent valuations or the acquisition cost serve as the basis.
Platform prices are therefore not useless, but they must be evaluated carefully. What matters is not the appearance of a market price, but the economic reality of the market.
