How Cryptocurrency Complicates Asset Division

IL divorce lawyerTen years ago, few people had ever heard about cryptocurrency. Today, millions of Americans have invested in companies like Bitcoin. In fact, over five percent of Americans, or over 15 million, have purchased Bitcoin alone, the most popular type of cryptocurrency, with the average American investing around $3,400. Some individuals have invested far more than this. And, because cryptocurrencies like Bitcoin rise and drop in value drastically at any given month, many people have made small fortunes with an early investment before 2018. In fact, one Bitcoin was worth around $700 in 2016. Today, one Bitcoin is worth roughly $3,800. That represents an increase in value of over 540 percent. As such, if someone invested $5,000 back in 2016, their investment would now be worth over $27,000. Interestingly enough, this can cause issues during the division of assets in a divorce.

Asset Division

One of the main aspects of divorce is dividing assets. Here in Illinois, marital assets are divided in an equitable fashion. This does not mean that all marital assets are split down the middle 50/50, however. When a couple cannot come to terms on their own or through mediation, a judge will divide the assets fairly or equitably.

What Is Marital Property?

Property owned before marriage is personal property. The value of this personal property, which may grow during the course of the marriage, remains personal property. Marital assets and property include everything that was acquired during the marriage. This includes bank accounts, real property, savings accounts earned with one party’s income, cars, and more. The only types of property acquired during a marriage that are not considered marital property are gifts, settlement or lawsuit awards, and inheritance.

Finding Hidden Assets

Part of an attorney’s role in divorce cases is to find potential hidden assets that the other party may have obscured from their spouse. Some spouses will go to great lengths to hide money from their partners, either years before the divorce or during the divorce proceedings. Some examples of where and how assets can be hidden include offshore bank accounts, safe deposit boxes, bank accounts opened under another name with a false identity, and cryptocurrency.

How Bitcoin “Accounts” Are Hard to Find

Unlike most types of money, Bitcoin leaves no paper trail. In fact, there are no wire transfers either. Bitcoin operates online, with peer-to-peer trading that makes identifying assets incredibly difficult. Bitcoin is not a company that keeps track of accounts as a bank does. The only person with any information about their Bitcoin assets is the owner of that Bitcoin property. There are methods of discovering hidden Bitcoin accounts, such as looking at IRS tax records, issuing a subpoena, and searching for large cash withdrawals or deposits, signaling a purchase or sale of Bitcoin assets.

Contact a DuPage County Attorney Today for Help

If you are going through a divorce, getting a true account of all marital property is absolutely vital. Marital property also has an effect on child support and alimony, making the discovery of any potential hidden assets, such as Bitcoin, all the more important. Contact a dedicated Hinsdale divorce attorney with the Law Office of Martoccio & Martoccio at 630-920-8855 to schedule a free consultation today. We are eager to assist you throughout each step of the process.

 

Sources:

https://cointelegraph.com/news/how-many-americans-really-own-crypto-skewed-results-of-polls-and-surveys

https://99bitcoins.com/price-chart-history/

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