With Texas being a community property state with each spouse getting 50% of the marital assets, some less than honest spouses may attempt to hide assets. One way that they might do this is through cryptocurrency purchases.
Cryptocurrency is still the Wild West of investing. The inventor of Bitcoin — probably the best known of the cryptocurrencies — designed this “peer-to-peer electronic cash system” to facilitate anonymous transfers between individuals with no involvement with government authorities or banking or traditional financial transfer systems. It is this anonymity that can lead to deceit when it comes to stashing assets.
Can cryptocurrencies be discovered and valuated?
Maybe. Cryptocurrencies are stored in online “wallets” accessible only by codes provided to the purchaser. Lose the code and you lose access to your cryptocurrency. However, forensic accountants can often use their considerable skills to ferret out the owner of the cryptocurrency.
Determining the value of Etherium or Bitcoin or other versions of cryptocurrencies in the highly volatile world of cryptocurrency exchanges is another tricky matter. A cryptocurrency that is presently riding high on the market can crash overnight for any number of reasons that affect the market and are out of the hands of the currency holders.
A spouse holding cryptocurrencies in an online wallet might intentionally engage in a flurry of trading activity involving currencies from other countries, making it even more difficult to determine the Fair Market Value (FMV) of the currencies in their digital wallet.
What to do if you suspect subterfuge with cryptocurrencies?
The first thing you should do is alert your Houston family law attorney that cryptocurrencies may be involved in your community property split. Your attorney can likely recommend a forensic accountant who can discover more information about your spouse’s crypto holdings.