Cryptocurrencies appear to be the new way for divorcing spouses to hide money, according to a recent article in Markets Insider. According to the report, hidden cryptocurrency is “increasingly common,” and found in about 15% of divorce cases handled by a cyber investigation agency based in the UK.
While 15% may not sound like a high number, the amount of assets in question is anything but small: crypto worth more than $10 million was concealed in several instances, according to the article. Additionally, NFTs, or non-fungible tokens, are becoming more commonplace, and must be considered in the context of a divorce. Similar to art, collectibles, and even real estate, a NFT is a unique digital item.
While such digital assets are easy to conceal because they do not show up on bank statements and are not governed by a central authority, when combined with some traditional discovery tools, cryptocurrency is still trackable for those who know how to find it. Each transaction is recorded on blockchain, a type of public ledger. Similarly, NFTs can be tracked but are more difficult to value. The NFT market is volatile, with the values of the digital assets fluctuating from day to day. Furthermore, there are no appraisers for NFTs, at least, none that are akin to a real estate appraiser or fine art appraiser.
To further complicate matters, unlike crypto, NFTs cannot be divided or fractionalized. There are two options: ownership may be transferred from one party to the other, in the same manner that a car title may be transferred from a wife to a husband; or, parties may sell their NFT and, after paying a royalty to the creator, divide the net proceeds.
If you have questions about cryptocurrencies and/or NFTs and you want to ensure that you receive a fair and equitable distribution of all marital assets, it’s important to talk to a top divorce attorney in Bucks County. Contact us at 215-340-2207 or email email@example.com.