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How Cryptocurrencies Are Making Divorce More Complicated

If you don’t invest in cryptocurrency yourself, chances are you have friends, relatives, or coworkers who do. Cryptocurrencies have gone from being a fairly specialized sector to becoming almost totally mainstream in a very short period of time. Now that cryptocurrencies are so widely used, there’s a new issue to contend with: how cryptocurrencies are handled during the divorce process.

During the majority of divorce processes, determining and distributing financial assets, as well as determining alimony payments, are essential concerns to be settled. There are various instruments available to an attorney for the disclosure of financial assets, but when you combine Bitcoin with divorce, you get something completely different.

For several major reasons, dealing with Bitcoin and divorce differs from dealing with traditional financial assets. One reason for this is the extreme volatility of their value. Bitcoin and other cryptocurrencies have been known to experience wildly fluctuating values, both up and down. As a result, value must either be tracked and changed on the fly, or it must be set at a specific moment, when it may be worth something entirely different afterwards. In either case, the situation isn’t ideal for evaluating and distributing assets or determining alimony.

Another important distinction to keep in mind when it comes to cryptocurrencies and divorce is that these marketplaces and transactions were created to be both anonymous and secure. Looking up an individual’s holdings, accounts, or transactions differs from looking up a bank account, retirement account, or stock portfolio. Tracing a person’s crypto accounts will be challenging at best, and whether or not the courts will use subpoena power to do so is unknown at this time.

Because all cryptocurrencies are still on the increase, this is clearly only the beginning of the issue of Bitcoin and divorce. As more people start or continue to use them, and as they become more mainstream and acknowledged, how they’re treated as financial assets during divorce processes will be a hot topic. The fact that they climbed so swiftly in the first place has caught many people off guard when it comes to how to treat them in such situations nowadays. Keep in mind that Bitcoin was only created a decade ago.

Always seek the advice of an experienced specialist in your region. While there is still a lot of mystery regarding how Bitcoin and divorce will be addressed, and what types of judgements we may expect in the future, an experienced divorce attorney can help you navigate the process and provide insight into financial discovery and other parts of your case.

What do you think?

Written by Trevanna Gordon

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