News

Divorce lawyers battle over bitcoin as crafty cryptos play hide the asset

0 Comments
The Royal Courts of Justice
Divorce battles are likely to worsen as crypto causes problems

WARRING spouses are using crafty investments in cryptocurrencies like Bitcoin and Ethereum to ensure their partners are cheated out fair divorce settlements.

Now lawyers are being urged to be creative, flexible and adapt fast to try to find ways to trace funds being squirreled away by artful dodgers.

One leading London law firm says it has three cases before the English courts involving potentially hundreds of thousands of pounds worth of the currency.

Royds Withy King says it is advising three cases involving assets made up of cryptocurrency which have rocketed in value.

Bitcoin becomes hide & seek tool in divorce

And they’re advising spouses “seeking the disclosure and a potential share of cryptocurrency assets” with one woman claiming her husband sunk £80,000 of their shared assets which are now valued at £600,000.

Mark Phillips, a partner in the Family team at law firm Royds Withy King said:When the computation of capital and incomes has been completed, the matrimonial pot can be divided by applying the notoriously discretionary Matrimonial Causes Act 1973.

Cryptocurrency is fast becoming a headache for lawyers
Tracing cryptocurrency is fast becoming a headache for lawyers

“This is the law that governs English divorce and financial remedies and the root cause of London being viewed as the divorce capital of the world, as well as the venue for associated forum shopping.

“A mere suspicion that someone may have invested in digital currencies will be hard to evidence and difficult to prove.

“The English divorce courts can be hard to persuade to endorse costly fishing expeditions potentially involving teams of forensic accountants and IT experts.

“The reality is that divorce lawyers and the courts are going to have to be flexible and adapt fast to cryptocurrencies and their early adopters.

“Digital currencies, assuming that they have been disclosed or identified and then valued, belong to the outer and left-field end of the asset spectrum. Divorce settlements will need to accommodate this in the balancing exercise required to achieve fairness between spouses.”

Young people favour pre-nuptial agreements

Mr Phillips went on to say that attitudes to marriage and divorce are also changing.

Last month Coinlist.me reported that young people were by large margins more involved in cryptocurrencies than any other age group.

cryptocurrency exchange
Cryptocurrency investment is now a feature of UK divorce

Mr Phillips added: “In the future digital currencies and block-chain technology are not going to go away. A recent UK survey by Coinlist.me revealed that 18 percent of 18–24-year olds considered Bitcoin to be an attractive investment opportunity and of these 8 percent stated that they had already invested.

“This same demographic are open-minded about the use of pre and post nuptial agreements to ring-fence assets – which might very well include valuable digital currency assets acquired before a marriage.

“The reality is that divorce lawyers and the courts are going to have to be flexible and adapt fast to cryptocurrencies and their early adopters.”

 

Leave a Reply

Be the First to Comment!

avatar
  Subscribe  
Notify of
Risk Warning: Investing in digital currencies, stocks, shares and other securities, commodities, currencies and other derivative investment products (e.g. contracts for difference (“CFDs”) is speculative and carries a high level of risk. Each investment is unique and involves unique risks.

CFDs and other derivatives are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how an investment works and whether you can afford to take the high risk of losing your money.

Cryptocurrencies can fluctuate widely in prices and are, therefore, not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework. Past performance does not guarantee future results. Any trading history presented is less than 5 years old unless otherwise stated and may not suffice as a basis for investment decisions. Your capital is at risk.

Past performance is not an indication of future results. Trading history presented is less than 5 years old unless otherwise stated and may not suffice as a basis for investment decisions. Prices may go down as well as up, prices can fluctuate widely, you may be exposed to currency exchange rate fluctuations and you may lose all of or more than the amount you invest. Investing is not suitable for everyone; ensure that you have fully understood the risks and legalities involved. If you are unsure, seek independent financial, legal, tax and/or accounting advice. This website does not provide investment, financial, legal, tax or accounting advice. Some links are affiliate links. For more information please read our full risk warning and disclaimer.
close-link