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How Are Crypto Assets Handled in a Divorce?

 Posted on July 25, 2023 in Divorce

IL divorce lawyerPeople are increasingly holding cryptocurrency assets, whether it is for savings or investment purposes. Crypto assets can greatly complicate a divorce. Crypto is treated as a marital asset, but it can present complex issues. You should hire a divorce attorney who has experience in high-net-worth divorces. You may also need to work with other experts to properly value and trace the assets.

Valuing Crypto Assets in a Divorce

Crypto assets are very volatile. The prices can fluctuate drastically by the day. You may find that the price has changed dramatically between the time that you agree to terms and the day that you sign the agreement. You may need to be creative in how you value these assets in a settlement agreement to ensure that the marital assets are equitably divided.

How Judges Value Crypto Assets

Many courts will treat crypto assets as if they are a cash equivalent and simply assign the value of where they are trading at that time in the open market. However, crypto may not always be fully a marital asset. One spouse may have purchased crypto before the marriage. Then, a judge would need to determine which part of the crypto is a marital asset and which would be considered individual property. If one spouse frequently traded crypto during the marriage, it may be difficult to value the assets. You may need a forensic accountant to give their own opinion of how the crypto should be valued. In addition, there may be large capital gains taxes that must be accounted for in asset division.

Crypto Can Be Difficult to Trace in a Divorce

Digital assets lend themselves to hiding in a divorce. Crypto assets may be more difficult to track than other investment securities. Some spouses think that they will be able to get away with failing to disclose their crypto assets. It may be easier to track Bitcoin and Ethereum. If the crypto exchange is in a foreign country, the assets may be more difficult to trace. You may need to hire a forensic accountant to ensure that your spouse has fully disclosed their crypto holdings.

Contact a Naperville Family Law Attorney Today

You should never try to handle your divorce on your own, especially when there are complex assets such as cryptocurrencies involved. The DuPage County divorce attorneys at Calabrese Associates, P.C. can help you resolve your divorce, whether it is through negotiation or litigation. You can call us today at 630-393-3111 to schedule an appointment to discuss your case.

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