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Cryptocurrencies and Divorce

Posted on in Division of Assets

DuPage County family law attorneyIf you are like many, you have only recently heard of the term “cryptocurrency” and may be unfamiliar as to what it actually is. Cryptocurrency simply refers to a digital asset which is used as a medium of exchange. The “crypt” part of the word refers to the encryption techniques used to secure the transaction. Cryptocurrencies are becoming increasingly popular because they are difficult to counterfeit and use peer-to-peer, decentralized networks for transactions. Bitcoin is the most popular cryptocurrency but hundreds more, including Litecoin and Ethereum, exist. One of cryptocurrencies’ main appeals is that they can be purchased and sold online. Cryptocurrencies can also be moved offline to a hardware device.

Cryptocurrency Can Be Hard to Value and Track

If you are getting divorced and you or your spouse have invested in cryptocurrency such as Bitcoin, you should know that cryptocurrency is treated like any other asset acquired by spouses during marriage. In Illinois, property accumulated during the marriage is subject to division through equitable distribution. The increase in popularity of cryptocurrencies represents a challenge to divorce attorneys and judges presiding over divorce cases. Unlike other forms of property, there can be serious difficulties tracking and valuing cryptocurrency.

Spouses Required to Be Honest and Transparent Regarding Finances During Divorce

When a married couple gets divorced, they are not only ending their romantic partnership, but also their financial partnership. In order for courts to make decisions regarding property distribution, spousal maintenance, and child support, each person must fully disclose all assets and debts. In order to decrease the amount of support they must pay, receive more of the marital property, or for other reasons, some spouses attempt to hide assets during a divorce.

A review of the potentially-untruthful spouse’s financial statements can offer clues that he or she is hiding assets in the form of cryptocurrency. If he or she has a cryptocurrency exchange linked to a credit card, debit card or bank account he or she may be covertly using cryptocurrency. Valuation is the next challenge after a spouse’s cryptocurrencies are identified. Cryptocurrencies are unstable and can fluctuate drastically over time.

We Handle Even the Most Complex Divorce Cases

If you or your spouse have investments such as funds in cryptocurrency, you will likely face a number of challenges during the divorce process. Therefore, it is very important that you get help and guidance from a trustworthy, experienced DuPage County family law attorney. To speak with a representative from the Pesce Law Group, P.C. today, call 630-352-2240.

Sources:

https://www.lexology.com/library/detail.aspx?g=b7a259ce-a12b-4263-9d85-47e175d1719e

https://news.bitcoin.com/british-couple-lawyer-up-as-840k-cryptocurrency-divorce-heats-up/

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