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Future For Your Family

How does cryptocurrency factor into asset hiding?

On Behalf of | Mar 23, 2022 | property division | 0 comments

Asset hiding is a phenomenon among divorcing couples that involves one spouse attempting to hide their assets from the other. By doing so, they theoretically avoid having to split all of their assets during the property division process.

Of course, this is illegal. Naturally, that does not stop everyone. In fact, more people in recent years have turned to newer methods of hiding assets, such as through cryptocurrency.

The illegal uses of cryptocurrency

CNBC discusses the use of cryptocurrency in hiding assets. Cryptocurrency such as bitcoin exist as a virtual currency which, up until recently, has escaped many of the regulations and oversight that traditional currency undergoes. Due to this, cryptocurrency became a hotbed for illegal financial activity, such as laundering money.

To a lesser but still illegal degree, spouses who want to hide assets will also use digital currency to mask their assets. Many people will buy shares of bitcoin, knowing that their spouse likely does not even know it exists, let alone how to track it.

Shining a light on unscrupulous behavior

But in recent years, attention on the digital currency community has grown more public and mainstream. As people’s attention in it skyrocket, so too do the regulations that cryptocurrency and other digital wallets and assets face. General knowledge also grows, meaning more lawyers know where to look.

This means that it is harder than before for spouses to hide their assets successfully in digital wallets. Forensic financial analysts also keep an eye on this medium of currency, and they can often track down people misusing their digital funds in an attempt to get around fair and equitable property division in divorce.

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