How Florida Courts Treat Cryptocurrency and Digital Assets in Divorce

During a divorce in Florida, each spouse receives an equitable share of the marital assets. For traditional assets, like bank accounts, homes, and cars, the spouses either split the assets or sell them and split the proceeds. In recent years, more couples have been acquiring digital assets, which adds another layer of complexity to asset division.

Examples of digital assets include:

• Cryptocurrency, such as Bitcoin, Ethereum, or stablecoins
• Non-Fungible Tokens (NFTs) for digital content, such as digital artwork, music, recordings or virtual property
• Security tokens, which allow for ownership of real-world assets

The Florida courts require divorcing spouses to disclose all their assets and split them equitably, whether they are digital or real-world assets. If one spouse fails to disclose all assets, the court can award the other spouse a greater share of the assets, require the offending spouse to pay all court and attorney costs for both parties, hold the offending spouse in contempt of court, or even charge the spouse with perjury.

Digital assets are much easier to hide than traditional assets, making them easier for a dishonest spouse to conceal. Oftentimes, if one spouse suspects the other is concealing assets, the suspicious spouse’s attorney may need to hire a forensic accountant that specializes in digital assets to uncover the hidden assets. The attorney may also need to request that the courts issue a subpoena to digital exchanges to find hidden purchases as well. This lengthens the time to complete the divorce and adds in costs.

Digital assets are much harder to value than traditional assets. Cryptocurrency, in particular, can have large and rapid swings in value. Both spouses with need to agree on a valuation method and valuation date. Attorneys for both sides might consult with financial experts to ensure the assets are properly valued.

Digital assets are also difficult to divide. Some types of digital assets can be split, but that requires both spouses to have digital wallets and knowledge of how to manage digital assets, which many people lack. Another option is selling the assets and splitting the proceeds. This can have significant tax implications, though. A third option is for one spouse to keep the digital assets and provide the other spouse with an equivalent value of traditional assets, such as brokerage accounts or real estate.

If you or your spouse owns digital assets, it’s important that you work with a divorce attorney who understands their complexity. Troy Legal has experience providing legal services to high-net-worth families with complex financial situations in Boca Raton, Miami, and throughout South Florida. We will work to uncover any hidden digital assets as well as consult with financial experts to properly value your assets. If you are thinking about a divorce, contact us today to learn how we can help you.