This CLE course will guide family law practitioners on identifying, locating, and valuing digital assets such as cryptocurrency, stablecoins, decentralized finance (DeFi) interests, token-based holdings, and nonfungible tokens (NFTs) in a divorce. The panel will offer best practices for handling the unique challenges presented by these ever more prevalent and increasingly more complex and valuable marital assets.
Family law practitioners must understand digital assets such as cryptocurrency, stablecoins, DeFi interests, token-based holdings, and NFTs due to their novelty and the difficulty of discovering, assessing, and litigating over them. These assets are increasingly common, ever more complex, subject to evolving reporting and recordkeeping requirements, and easy to hide. Even if disclosed, digital currency is often difficult to value. Failure to recover, preserve, or appropriately value these assets during divorce and property division could result in grave harm to the client.
In today's divorce proceedings, counsel should formally request documentation concerning cryptocurrency, NFTs, stablecoins, exchange accounts, wallet activity, staking rewards, and any other similar digital asset holdings. It may take a forensic accountant to uncover these items if a spouse refuses to disclose them. Failure to do so may deprive the non-cryptocurrency-owning spouse of a significant financial asset.
Proper disclosure of cryptocurrency or NFTs does not end the special issues related to these assets. They must be valued. But they are highly speculative and subject to wild swings in value. Such fluctuations add substantial complexity to divorce proceedings. Counsel also must address valuation date, liquidity, ongoing rewards or yield, and tax-basis considerations when structuring division.
Listen as our panel provides guidance to family law practitioners on best practices for uncovering and addressing the existence of cryptocurrency assets and other blockchain-based holdings in a divorce. The panel will discuss ways to navigate the unique issues associated with locating and valuing digital assets and best practices for managing these marital assets.
