Editas Medicine, Inc. Fair Value Disclosure
| Financial Assets | December 31, 2024 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
| Cash equivalents: | ||||||||||||||||||||||||||
| Money market funds | $ | 131,541 | $ | 131,541 | $ | — | $ | — | ||||||||||||||||||
| Marketable securities: | ||||||||||||||||||||||||||
| Corporate bonds | 6,501 | — | 6,501 | — | ||||||||||||||||||||||
| U.S. Treasuries | 131,871 | 131,871 | — | — | ||||||||||||||||||||||
| Restricted cash and other non-current assets: | ||||||||||||||||||||||||||
| Money market funds | 3,877 | 3,877 | — | — | ||||||||||||||||||||||
| Total financial assets | $ | 273,790 | $ | 267,289 | $ | 6,501 | $ | — | ||||||||||||||||||
| Financial Assets | December 31, 2023 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
| Cash equivalents: | ||||||||||||||||||||||||||
| Money market funds | $ | 123,652 | $ | 123,652 | $ | — | $ | — | ||||||||||||||||||
| Marketable securities: | ||||||||||||||||||||||||||
| Government agency securities | 103,180 | — | 103,180 | — | ||||||||||||||||||||||
| Corporate bonds | 30,834 | — | 30,834 | — | ||||||||||||||||||||||
| U.S. Treasuries | 169,469 | 169,469 | — | — | ||||||||||||||||||||||
| Restricted cash and other non-current assets: | ||||||||||||||||||||||||||
| Money market funds | 3,877 | 3,877 | — | — | ||||||||||||||||||||||
| Total financial assets | $ | 431,012 | $ | 296,998 | $ | 134,014 | $ | — | ||||||||||||||||||
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.