Divorce is frequently complex and emotionally fraught for people in Michigan and across the United States. However, it can also be a complicated financial and practical matter, with serious implications for both parties. When people have significant assets on hand, including businesses, investments, valuable real estate or other wealth, spouses may be highly invested in protecting their assets and emerging from the divorce with their standard of living and resources in place. The rise of bitcoin and other cryptocurrencies has added an interesting wrinkle to the division of property in high-asset divorces.
Throughout 2017, the cryptocurrency market saw a massive jump in value propelled largely by bitcoin. The legal and financial implications of bitcoin ownership have changed dramatically from its earliest days, when the cryptocurrency was easily mined on a home computer and worth very little in traditional currency. Today, however, bitcoin can be considered a property interest like other forms of currency or securities – and an asset of significant value. However, because of the nature of bitcoin, it is easy to transfer and difficult to determine ownership, which can lead to the concealment of bitcoin wealth in a divorce.
Cryptocurrencies could be used to hide assets, especially because of their lack of traceability. On the other hand, they can also make assets easier to divide than ever before; simply creating a new wallet and transferring bitcoin can take minutes. The valuation of the cryptocurrency can present another puzzle as it fluctuates significantly against the U.S. dollar. If the asset division does not include a simple split of a bitcoin wallet, shifting valuations could rapidly change the relative value of bitcoin.
Whether people are dealing with new high-value assets like bitcoin or existing traditional assets, divorce comes with serious implications for property and asset division. A divorce lawyer may be able to represent in a high asset divorce. The attorney may be able to assist in assessing the value of complex assets, seeking full disclosure and protecting his or her client’s rights.