Property division is typically one of the most contentious parts of divorce. Couples often find it difficult to decide how to distribute assets such as real estate and savings. Discussions may become more frustrating, not to mention confusing, when digital currencies enter the equation.
Although cryptocurrency is nothing new, it has yet to breach the cusp of critical mass. Individuals interested in new technology have coded, invested and fought for decentralization while regulators struggled to gain understanding.
Cryptocurrency in divorce
As Bitcoin and other digital tokens gain acceptance, however, many people still lack understanding about the “cryptoverse.”
You might be able to claim a portion of your spouse’s digital currency in a divorce settlement. But first, you have to find it. Then, you must determine its worth.
Crypto utilizes blockchain technology, which provides an intricate system of agreements for registered users to complete transactions. Without authorization to access your ex’s specific digital wallet, you may not know if there’s anything at stake.
You will likely need to involve the services of an experienced forensic accountant to verify whether your ex holds hidden assets in binary. Just be sure to find one who’s knowledgeable about the intricacies of computer code.
Value depends on the day
If you do know there’s crypto at stake, you’ll have to find out how much it’s worth. No matter where in the world the funds are allocated, the volatility of cryptocurrency and varying regulations could lead to a significantly unfair settlement between valuation and settlement.
It could cost you
Selling or exchanging digital tokens may lead to additional tax liability. Once again, you must learn about the factors that could influence what, if anything, you owe.
If your ex participated in an Initial Coin Offering (ICO), you would be wise to determine whether you agree with how your forecasted returns will be made. Many companies profit greatly through crowdsourcing, but the tumultuous international capacity of crypto can easily cloud transparency in legal and ethical business practices.
Is crypto in your best interest?
Individuals who have substantial cash flow that enables them to wait indefinitely for a potential financial boost may certainly see digital gains. Either way, you should probably consider what you need after divorce before you decide to include the uncertainties of peer-to-peer funding in your settlement.