Does Cryptocurrency Need to Be Divided in a Michigan Divorce?

 Posted on May 25, 2022 in Divorce

The idea of a union between two people coming to an end has existed for as long as couples have formally paired together in front of friends and family. But, certain parts of divorce are in constant flux; Michigan state law can change, social mores can change, and even the types of property spouses accrue together can change. 

Cryptocurrency is a recent example of an asset that is so new, poorly understood, and minimally regulated that dividing it in a divorce can be quite complicated. Because more and more people are buying cryptocurrency every day, understanding how it is handled in a divorce may be essential for protecting your financial interests.

Understanding Cryptocurrency

Cryptocurrency is digital currency secured by cryptography. Unlike dollar bills, which can be replicated and counterfeited, each cryptocurrency “coin” is verified with its own unique identification. Cryptocurrency is “mined” using blockchain technology on many computers, and because coins are not owned or created by just one person or organization, one of the attractive features of cryptocurrency is that it is not currently subject to governmental interference. 

How Can We Divide Our Assets If The Value of Cryptocurrency Changes Every Day? 

Many people have taken significant risks and placed all or most of their savings into cryptocurrency. But the price of cryptocurrency can change in just a few hours, making it tricky to divide during divorce. At some point during the divorce process, when a couple is ready to negotiate their asset division, they will need to determine and declare a cryptocurrency’s worth in cash. 

Then, couples can allocate their cryptocurrency and other assets accordingly. One spouse may want to avoid the use of cryptocurrency altogether and prefer to sell or trade their cryptocurrency and retain the cash value. Spouses may also set up individual crypto “wallets” and transfer their portion of the cryptocurrency. Other times, one spouse may keep all the cryptocurrency in exchange for the equivalent value of other marital assets. 

What If My Spouse Tries to Hide Cryptocurrency? 

Because it is easy and cheap to send cryptocurrency, it can be difficult to discover cryptocurrency when somebody wants to hide it. If you suspect your spouse is hiding cryptocurrency, your attorney may need to subpoena their computer, bank statements, and purchase history to determine whether there is evidence of the purchase of cryptocurrency. 

Schedule a Complimentary Consultation with a Farmington Hills Divorce Lawyer

The inherent complexities of dealing with cryptocurrency require the help of an Oakland County divorce attorney with extensive skill and knowledge of Michigan law and cryptocurrency trends. For help ensuring your marital assets are divided fairly, schedule a free consultation with Elkouri Heath, PLC by calling us now at 248-344-9700. 

Source: 

https://www.investopedia.com/terms/c/cryptocurrency.asp