Why does a $1 stablecoin sometimes trade below $1?

A holder who cannot redeem can exit only by selling, so the price on each book is set by whoever is buying and selling there at that moment. On Saturday 11 March 2023, USDC traded below a dollar while, on Circle's own account, redemption waited for US banks to reopen.

Is USDC worth $1 in the financial statements?

Not by default. Where the measurement model calls for fair value, it is the price in the entity's accessible principal market at the measurement date, and a redemption right does not replace it. A holder measuring USDC as a financial asset at amortised cost works from the contractual cash flows instead.

Is a USDe/USDT quote a dollar price?

No. It is a price in USDT, and it becomes a dollar price only when converted at a USDT/USD rate from the same moment, in a book the entity's policy names. On 10 October 2025, Binance's 0.65 trade was 0.6508 dollars at Kraken's rate and anything from 0.6507 to 0.6636 at Coinbase's, depending on the second.

How does the peg affect a sterling reporter?

Even a token that holds exactly $1 rises or falls in sterling as the GBP/USD rate changes. How that change is recognised depends on classification and measurement. For USDC held as a financial asset by a Circle Mint customer, a monetary item, the closing rate applies, with the difference in profit or loss.

Stablecoin Valuation: Why One Dollar Has Many Market Prices

Stablecoin valuation is the work of putting a price on a token designed to trade at one US dollar. That price is not 1.00 by default. The same stablecoin trades at many prices at once, and fair value comes from a market the holder can actually use, not from the dollar peg or a redemption promise.

Why does one stablecoin have many prices?

The peg is the one-dollar price a stablecoin is designed to hold. The token itself never trades at one number. Each exchange keeps an order book, its list of buy and sell orders, for each trading pair. The USDC/USD book is where USDC is bought and sold for dollars. The second currency, the dollar here, is the quote currency.

Every book has its own last trade, some seconds old and some hours old. On 11 March 2023, USDC's lowest trade was 0.874 on Kraken's dollar book and 0.80526 on Bitstamp's. Both are real, and neither is "the" price. On 31 December 2025, USDS last traded at 0.95555 on Kraken and 0.9995 on Coinbase, 4.4 per cent apart.

The peg invites a shortcut, and no standard permits it. The word "stablecoin" does not occur in IFRS 13, IAS 21, IAS 36, ASU 2011-04 or ASU 2023-08. So the fair value rules for any asset apply unchanged.

When you need a price depends on the measurement model:

Amortised cost: at initial recognition, and for disclosure unless the carrying amount approximates fair value.
Intangible asset: when an impairment test needs it.
US GAAP, inside ASC 350-60: at every reporting date.

Whatever the model, the input is a price. Our stablecoin primer explains how each token works.

What did the 2023 and 2025 depegs show?

A depeg is a move away from the one-dollar target.

USDC, 11 March 2023. Circle, the issuer, said $3.3bn of USDC's cash reserves sat with Silicon Valley Bank, which had just failed. It added that redemption follows US banking hours, and this was a Saturday. Kraken's USDC/USD book fell to 0.874 before recovering to near 0.97 by the close.

Circle later said the deposit, about 8 per cent of the reserve, would be fully available when US banks opened. A holder measuring USDC at fair value that day would have used the price in its principal market, not the redemption amount.

DAI, the same morning. DAI has no issuer. It is produced by the smart contracts (programs that run on a blockchain) of the Sky protocol, so a holder has no claim on anybody. Yet Kraken's DAI/USD book fell to 0.85, seconds after USDC's low.

One reading points to the protocol's swap module, which accepted USDC at a dollar. At the lows, USDC taken in that way stood behind more than half of all DAI issued. Whatever the cause, "crypto-collateralised" describes how units are created, not what the price is exposed to.

USDe, 10 October 2025. Binance's USDe/USDT book recorded a trade at 0.65. That price was in USDT, and USDT itself traded above a dollar that hour. At Kraken's USDT/USD rate that second, 1.00121, the trade was worth 0.6508 dollars. Kraken's USDe/USD book, quoted in dollars, had a low of 0.9496, set by one trade of 9.21808 USDe.

Binance had said it would stop accepting new UK users from 16 October 2023. So for a UK company with no Binance account, the 0.65 trade was not a price in any market it could use. Which number matters is an access question before it is a price question.

Why is a redemption right not a market price?

To redeem is to hand a token back to its issuer for dollars. Only some holders can, such as Circle Mint customers, verified Tether customers and Ethena's approved Mint Users (who can redeem each token). A holder without that access can exit only by selling.

IFRS 13 defines fair value as the price received to sell an asset in an orderly transaction between market participants at the measurement date. A redemption is not a market sale but a transaction with the issuer, on its terms, fees and hours.

Three reasons keep the redemption amount out of fair value:

A quoted price in an active market comes first. It "shall be used without adjustment to measure fair value whenever available, except as specified in paragraph 79" (IFRS 13). In our reading, none of those exceptions lets a holder swap in a redemption amount.
Issuers do not promise the price. Circle's terms say "Circle does not guarantee that the value of one (1) USDC will always equal 1 USD ($1) on other platforms".
Redemption has costs. Tether's fee page sets a 100,000 USD minimum and a fee of the greater of $1,000 or 0.1 per cent. Redeeming 100,000 USDT returns 99,000 dollars, 0.99 per unit. At the 2025 year-end market price of 0.99848, a small verified customer would have done better by selling.

In our reading, the right still shapes the price. When the price falls below what those holders can redeem for, they can buy and redeem, which normally holds the price near a dollar. When redemption cannot be used, as on that Saturday in 2023, the price shows it.

So the market price is the measure. A holder that can itself redeem may reflect that route in IAS 36 value in use, net of fees, minimums and delay. That is our analysis, not a requirement of any standard. It never enters fair value. At amortised cost, the redemption terms drive the carrying amount through the contractual cash flows.

Which market does stablecoin valuation use?

IFRS 13 uses the principal market, the market with the most trading volume and activity for the asset. The entity must be able to access it at the measurement date. One practical approach is to rank the books you can use by trading volume, and to repeat the ranking during the year.

For a UK company with accounts at Kraken and Coinbase, four findings stand out:

It moves. USDT's principal market moved from Coinbase to Kraken between the April and July assessments. KPMG's handbook notes that this can happen between measurement dates.
It may be quoted in euros. From July 2025, Kraken's busiest USDC book was USDC/EUR, ahead of USDC/USD.
The biggest market may be closed to you. On 10 October 2025, Binance's USDe/USDT book traded about 1.47 billion USDe, against about 173,000 on Kraken's USDe/USD book. On their own statements, neither Binance nor Bybit took new UK customers that day, and a market you cannot access cannot be your principal market.
It can close. Coinbase's DAI-USD book was DAI's principal market at the 2025 year end. It traded for the last time on 4 May 2026.

Use trades, not daily candles. A candle is the venue's summary of a day's trading, and it can mislead. On 26 July 2025, Kraken's USDS/USD book had no trades, yet its candle still read 0.80110, carried forward from the day before.

No standard names a cut-off time. The AICPA's nonauthoritative practice aid points to the last trade before midnight in the entity's time zone.

Write the fallback before the first year end that needs it. Our worked example's policy tries the principal market's last trade within 60 minutes, then the next accessible book, then a labelled estimate. It never uses par because a price is missing.

What changes when your books are in pounds?

Your functional currency is the currency of the main economic environment your business operates in, usually where it mainly earns and spends cash. Even a token that holds exactly $1 rises or falls in sterling as the GBP/USD rate moves. So a sterling reporter needs two numbers: the token's price in its quote currency, and an exchange rate.

IAS 21 names no source for that rate. On 31 December 2025, the Bank of England's daily figure was 1.3451 dollars per pound, while Kraken's GBP/USD book last traded at 1.3476 before midnight. Your policy has to name one.

How the change is booked depends on the classification:

Monetary item, such as USDC held as a financial asset by a Circle Mint customer: use the closing rate, with the difference in profit or loss.
Non-monetary item at fair value: translate at the rate on the date fair value was measured.
Impairment test: translate recoverable amount at the rate when it was determined, such as the closing rate, and compare it with cost at the transaction-date rate.

A compact example. A sterling company holds 10,000 USDC at 31 December 2025. Here is the value on three bases, at the Bank's closing rates:

Kraken USDC/USD, last trade 0.9996: $9,996, or £7,431.42 at 1.3451 dollars per pound.
Kraken USDC/EUR, last trade 0.8511: €8,511, or £7,430.59 at 1.1454 euros per pound. This was the principal market in our worked journal-entry example.
Par, 1.00: $10,000, or £7,434.39, which is £2.97 more than the dollar book.

No transaction cost enters fair value in either market case. A holder with its own right to redeem for $10,000 still measures fair value at the principal-market price.

Key takeaways

A stablecoin has many prices at once, and no accounting standard lets you assume 1.00 because of the peg.
Where fair value is needed, take the price from your accessible principal market at the measurement date, and recheck which market that is during the year.
A right to redeem is a different transaction with the issuer. It does not replace the market price in fair value.
A price in USDT or euros is not a dollar price, and a sterling reporter also needs an exchange rate its policy names.
Write the fallback before the year end needs it, so a missing price never defaults to par or to a zero-trade candle.

How Tokenbooks helps with stablecoin valuation

A Tokenbooks portfolio can leave stablecoins at market, so a depeg reaches the books through the daily close. A portfolio kept in pounds, Canadian dollars or euros values a dollar stablecoin with a market price, such as USDC, from its own daily close in that currency. Its gains and losses are then measured in the portfolio's currency.

Every value records its source. A fair value can also be entered manually as a unit price for an asset within a transaction.

Start with the crypto accounting workflow in Tokenbooks.