Cryptocurrency Can Cause Challenges During Divorce
In recent years, cryptocurrency (crypto) has become increasingly popular. While it is a great way to securely store value, there are certain challenges that arise when it comes to divorce proceedings. This blog post will discuss how cryptocurrencies can be used to hide assets during divorce and the challenges that this presents.
What is Cryptocurrency?
Cryptocurrency is a digital currency that uses cryptography for security. It is decentralized, meaning it isn’t managed by any government or financial institution.
Crypto also offers anonymity, as users don’t have to provide any personal information when making transactions with these currencies. Cryptocurrencies are stored in digital wallets, which can be accessed from anywhere in the world as long as you have an internet connection.
How Cryptocurrency Is Treated in a Divorce
Cryptocurrency is treated just like other assets. In New York, marital property (i.e. assets acquired during your marriage) is subject to division, and the courts aim to divide property equitably. Thus, unless you acquired the cryptocurrency before your marriage, it is subject to division.
Using Cryptocurrency to Conceal Assets
Cryptocurrency has several features that make it attractive for hiding assets during divorce proceedings. One feature is its lack of transparency—specifically regarding the fact they are not managed by a bank. This makes it easier for someone to transfer funds without leaving behind a paper trail that could be traced back to them by law enforcement or the courts.
Additionally, the value of cryptocurrencies fluctuates wildly; this means that someone who acquires cryptocurrency at one price could suddenly see its value skyrocket days later—potentially giving them access to much more money than they originally had available. This makes tracking any transfers made with cryptocurrency even more difficult because the amount transferred may change drastically over time in either direction. The anonymity that users have can also make it hard to track transfers or learn the identity of the owner of cryptocurrencies.
What Should I Do if I Suspect My Spouse Is Hiding Assets Using Cryptocurrency?
If you suspect your spouse is hiding assets using cryptocurrency, you should contact an experienced lawyer as soon as possible. An attorney will be able to advise you on any legal options available and help you protect your financial interests in court if necessary. Additionally, there are companies out there that specialize in finding hidden digital currency accounts—so you may also want to consider hiring one of these services to investigate further on your behalf.
While challenging, you can also try to take steps to uncover hidden cryptocurrency. First, you can search your records for a precise wallet address that stores the cryptocurrency; this address can be used by forensic experts to track transactions made using that wallet. Next, you can also review previous tax records as your spouse may have included cryptocurrency amongst their income.
Consult with Our Attorneys
Cryptocurrency has become increasingly popular over the past decade, but many people still don’t understand how it works or why it’s so attractive for those looking to hide assets during a divorce. By understanding how cryptocurrencies work and what options are available if you suspect your spouse is using them to conceal funds, you can better protect yourself financially during this difficult process.
If you have questions about how crypto assets may factor into your situation specifically, you can discuss your case and concerns with the attorneys at the Law Office of Dennis R. Vetrano, Jr., LLC. Our attorneys have decades of collective legal experience and are prepared to help you protect your assets and interests.
Call (845) 605-4330 or reach out online to schedule a case consultation today.