Tag Archive for: cryptocurrency and divorce lawyer

The Dogecoin Divorce

Industry groups estimate more than 20 million Americans may own cryptocurrency, including Dogecoin. Now many are left wondering how to split holdings in divorce settlements. 

Divorce is one of the most stressful events that a human can endure. It can be physically, emotionally, and financially draining. Especially when you’re dealing with the division of your assets. Now that some of those assets have gone digital for an increasing number of people, an already complicated process stands to get more difficult.

Cryptocurrency is a digital form of payment that can be used to purchase goods or services online. Every transaction is done online and tracked via a highly secure ledger called a blockchain. You might have heard of Dogecoin, a crypto that has made big news lately for its wildly fluctuating value. There are more than 10,000 unique publicly-traded cryptos, with more being added every day.

In the sixth part of our Cryptocurrencies and Divorce series, we discussed the situations in which cryptocurrency can be found during the divorce settlement process and also if it can be lost within the settlement. While tracking down the funds isn’t an easy process, our third part of the series will give you a little more insight on the Cryptocurrency Dogecoin Assets.

With all of these forces at play during a divorce, it’s best to be prepared for whatever the outcome may be and hiring a family law attorney well-versed in cryptocurrencies is always an advantage. Here’s what you need to know about Dogecoin and Divorce.

What is Dogecoin?

Dogecoin originated as an alternative to traditional cryptocurrency such as bitcoin. Both the name and logo were based off of a meme that went viral. Dogecoin is intentionally abundant which is different in comparison to bitcoin which is scarce. In 2021, Dogecoin became one of the biggest cryptocurrencies in the market. 

Since Dogecoin was created to be abundant, miners were able to produce more by the minute. DOGE was based on supply and demand, and that surged enomurlsey which inturn has given it a higher value- due to reddit threads popularizing this cryptocurrency. 

Fast-rising DOGE prices in 2021 attracted media attention due to social media memes, which created a cycle that attracted more investors and further increased prices. Whenever an asset sees such dramatic gains, people tend to have a fear of missing out, which brings waves of new traders into the fold. 

It’s important to note that DOGE remains a highly volatile cryptocurrency. Like any investment there is no guarantee that it will go up or down in the future.

Challenges of Crypto & Divorce

The rising popularity of cryptocurrency for investors means that it is becoming a factor in divorce settlements. Many spouses are attempting to hide their money inside crypto to keep it from being divided between themselves and their future ex-partners.  

​​The costs associated with uncovering hidden cryptocurrency assets can also be substantial. Before moving forward with a court order to uncover potential hidden crypto assets, a spouse and their divorce lawyers may want to make sure that they are relatively certain about the outcome. 

One of the biggest obstacles for divorcees is simply a lack of understanding about what crypto is and how it factors into the traditional financial portfolios of divorcing spouses. The amount of money involved is also a consideration. People with a few hundred or even a few thousand dollars in undisclosed cryptocurrency are rarely the proper target of such an investigation. An experienced family law attorney may help a spouse concerned about crypto assets decide whether or how to pursue a court order and full forensic investigation. 

Final Thoughts

Living in a digital age like we do today, where things become meme-able by the second due to social media, it’s important to stay in the know. That’s why Dogecoin, Bitcoin, and other cryptocurrencies are increasingly expected to pop up in a divorce settlements today and in the future.

Because splitting digital currency may be more complex than traditional investments, such as stocks, bonds, or mutual funds, it is important to be prepared and make sure that crypto is properly discovered and valued in family law matters. If you know or suspect that cryptocurrency will be a part of your divorce, talk to your family law attorney immediately and put together a game plan for dealing with it. 

Our team of award-winning attorneys are highly experienced in dealing with Cryptocurrencies in divorce, and are here to answer your questions about divorce and digital asset division.

Contact us today for more information, or to schedule a consultation.

Top 6 Signs Your Spouse is Hiding Crypto

Is my spouse hiding Crypto? We know hiding assets is a penalty-inducing divorce tactic used by many. But in 2022, soon-to-be divorcees are hiding money from family members and authorities using cryptocurrency.

Cryptocurrency nowadays can add new complications to a divorce. Just like any other marital asset, if cryptocurrency, or other digital currency was purchased, or increased in value, during the marriage, it is a marital asset that is subject to distribution in both equitable distribution and community property states.

In the fourth part of our Crypto Currencies and Divorce series, we discussed the situations in which we discussed the situations in which cryptocurrency can be found during the divorce settlement process and also if it can be lost within the settlement. While tracking down the funds isn’t an easy process, this article will give you signs to watch out for.

Here’s what you need to know if your spouse is hiding crypto.Hiding Crypto

1. Bank and Credit Statements

First things first, if you believe that your spouse is hiding cryptocurrency and has used marital money to purchase it, you should take an active role in looking for proof of your suspicions.

Cryptocurrency is usually purchased with liquid cash, so at some point money moves from a bank account into a cryptocurrency exchange. Certain websites function as the entry point for most people interested in obtaining or trading Bitcoin and other digital currencies. Look for popular echange names such as: Coinbase, Binance, Etoro, Coin Switch, Luno and PaxForex. All it can take is one initial transaction in “normal dollars and cents” to enter this new world of Bitcoin, where untold more digital currency can be obtained. 

If you see any crypto activity, however insignificant, it’s worthy to investigate further — especially if your spouse omitted it from the initial deivorce documentation.

2. Crypto Wallets and Private Keys

Crypto keys make for excellent evidence. Each crypto wallet comes with a key that can then be traced to show all transactions associated with the wallet. A sure sign of Crypto activity in the household is the discovery of a crypto key. But not many know what to look for, since the key doesn’t represent a traditional metal object. So what do these keys look like?

A private key is a secret, alphanumeric password/number used to spend/send your bitcoins to another Bitcoin address. It is a 256-bit long number that is picked randomly as soon as you make a wallet.

The degree of randomness and uniqueness is well defined by cryptographic functions for security purposes.

This is how the Bitcoin private key looks:

2zJ4kLf5zgWrnogidDA76MzPL6TsZZY36hpXXssSzNydYXYB9fe

Many of these password keys are stored on a keydrive. If you happen to find this key, take note of it for evidence. Many hide these keydrives in a private and secure place, such as a safe, while others can simply save these password key codes hidden on their laptops.

3. Presence Crypto Exchanges in Apps

See if there are any crypto-related apps installed on shared electronic devices. Look for Bitcoin wallets like Coinbase, Mycelium, Ledger, SoFi, and Trezor, or apps for buying and selling crypto, like CEX.IO or BlockFi.

Any of the common exchanges listed above offer apps for mobile crypto banking. If you share one phone account, you may be able to access the history of all apps downloaded to any phone on your plan. If you are not able to obtain this information on your own, your attorney can add to this to items to be produced during discovery.

4. Loan Applications & Tax Returns

Another area to explore are loan applications and tax returns. If a person is trying to hide assets from you, and they are not disclosing Bitcoin or other cryptocurrencies on their net worth statement, they might record it on a loan application. 

It’s also important to check if your spouse has reported crypto on tax returns. Reporting of digital currency is required by the IRS, even though there are those who fail to do so. In 2014, the IRS declared that virtual currencies are property.

5. Large Online Purchases

For spouses who are hiding currency, they don’t buy the initial crypto to put in their wallet, which in turn, avoids any direct charges made to a bank or credit account. Instead, they connect with a crypto user in one of the many user forums who is willing to accept goods that will be paid in said cryptocurrency. 

The agreement might entail buying items of the crypto owner’s choice on Amazon, and in return, this crypto will be deposited in the owner’s empty wallet, giving them their entrance into this world. It’s important to remember that crypto wallets function completely outside the normal banking system, so no one will be the wiser should this transaction take place — unless you get smart about your spouse’s buying habits. 

Scan Amazon and other online sellers. If you don’t have access to your spouse’s Amazon account, this can be something that your attorney requests to see during divorce discovery.

6. Secretive Behavior with Finances

If you still receive paper statements this is a great way to track down their use of bitcoin and other cryptocurrencies. If the paper trail used to show up in the mail and then suddenly stopped – that’s a red flag and should raise some suspicion. 

It’s important to have passwords to all of your shared online bank and credit accounts, but if they’ve been changed, that’s again, another red flag. Call your bank and credit card company to request copies be sent directly to you for all joint accounts. Let your attorney know as soon as possible so that steps can be taken to make your spouse produce documentation of all joint accounts.

Final Thoughts

If you know or suspect that cryptocurrency will be a part of your divorce, talk to your family law attorney immediately and put together a game plan for dealing with it. 

At Masters Law Group, our team of attorneys are highly experienced in dealing with Cryptocurrencies in divorce and are here to answer your questions about divorce and digital asset division.

Contact us here today for more information, or to schedule a consultation