The growing popularity of CRYPTOCURRENCIES as investment assets has introduced a new source of conflict in divorce cases. Hidden digital assets are a growing concern, leading to confusion in divorce proceedings.
In fact, divorce lawyers and financial advisors are now faced with complex situations stemming from financial undisclosed related hoax cryptocurrency holdings, CNBC reported on May 20.
The scenario is particularly prominent in states like Florida, Texas, New York, and California, where cryptocurrencies play a significant percentage of divorce cases, ranging from 20% to 50%.
Interestingly, lawyers and advisers are uncovering cases where a spouse secretly invests substantial amounts, ranging from hundreds of thousands to millions of dollars, in cryptocurrency without their partner's knowledge.
Tactics deployed to hide cryptocurrencies
Some tactics involved include spreading crypto into various currencies in different block chains and complicating the tracing of money trails. Interestingly, due to the ability to track Bitcoin (BTC) in some cases, spouses opt for privacy-focused digital assets like Monero (XMR).
โWhat I find in litigation is that this is very new to all of us, even the most experienced lawyers, unless you really put in the effort to study this โ educating the court, knowing what to ask for and finding the right experts, is a lot. more difficult for me than other areas of the law that have been around much longer,โ said marriage and family law attorney Kim Nutter.
For example, in one case, a woman discovered her ex-husband's undisclosed crypto wallet containing 12 Bitcoins, valued at approximately $500,000 at the time.
Interestingly, forensic investigators who specialize in cryptocurrency tracing have emerged as a new profession amid the search for hidden crypto assets during divorces.
Lack of regulations
Tracking hidden crypto assets has become increasingly complex as hunters face challenges stemming from the decentralized and unregulated nature of cryptocurrencies. Obtaining cited information related to these assets is often difficult due to the absence of centralized regulation.
โThe thing about cryptocurrencies is that they are not regulated by any kind of centralized bank, so you generally can't subpoena someone and get documents and information related to someone's cryptocurrency holdings,โ the statement said. divorce attorney Kelly Burris.
At the same time, the valuation and division of marital assets are also significant challenges when spouses include metaverse property and non-fungible tokens (NFTs) in your crypto wallet.
In general, the clandestine presence of cryptocurrency in divorce cases presents unique challenges, testing the expertise of legal and financial experts.
