Company: BSFC
Filing Date: 2025-08-19
Form Type: 10-Q
Source: 0001493152-25-012137
Chunk: 52

Company: Blue Star Foods Corp.
Filing Date: 2025-08-19
Form: 10-Q
Item: Part I, Item 1
Chunk 52
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 foreign currency exchange rates affect its financial statements.

Fair
Value Measurements and Financial Instruments

Fair
value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date and is measured using inputs in one of the following three categories:

Level
1 measurements are based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to
access. Valuation of these items does not entail a significant amount of judgment.

Level
2 measurements are based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar
assets or liabilities in markets that are not active or market data other than quoted prices that are observable for the assets or liabilities.

Level
3 measurements are based on unobservable data that are supported by little or no market activity and are significant to the fair value
of the assets or liabilities.

Our
financial instruments include cash, accounts receivable, accounts payable, accrued expenses, debt obligations, derivative liabilities
and warrant liabilities. We believe the carrying values of our cash, accounts receivable, accounts payable, and accrued expenses approximate
their fair values because they are short term in nature or payable on demand. The derivative liability is the embedded conversion feature
on the 2023 Lind convertible note. All derivatives and warrant liabilities are recorded at fair value. The change in fair value for derivatives
and warrants liabilities is recognized in earnings. The Company’s derivative and warrant liabilities are measured at fair value
on a recurring basis using the Black Scholes Pricing model as of June 30, 2025 and December 31, 2024. There were no financial assets
and liabilities that were measured at fair value on a recurring basis under Levels 1 and 2.

Schedule
of Derivative and Warrant Liabilities Measured at Fair Value 

    Level 3 Fair Value 

    As of June 30, 2025  
    As of December 31, 2024 
  
    Liabilities 

    Derivative liability on convertible debt 
    $19,629  
    $49,565 
  
    Total 
    $19,629  
    $49,565 

    12

The table below presents the change in the fair value
of the derivative liability convertible debt and warrant liability during the six months ended June 30, 2024:

Schedule
of Change in Fair Value of Derivative Liability Convertible Debt and Warrant