Cryptocurrencies, such as Bitcoin, Ethereum, and a host of others are significant financial assets, but with a highly fluctuating market value. This makes it important to address what happens to your crypto holdings in the event of a divorce. Whether you are a newbie dipping your toe in the pool of digital assets, or an early crypto adopter millionaire, a prenuptial agreement can prove to be useful in protecting your financial interests in assets such as cryptocurrency.
Your crypto assets might have an exponentially high value at a future date in case of a divorce. An experienced divorce attorney in Auburn, AL can help you and your partner arrive at a fair mutual understanding and legal agreement so that you are both financially protected after marriage.
Prenuptial Considerations to Protect Your Crypto Assets During a Divorce
Cryptocurrency has captured the attention of the court system in recent years. It has become the subject of lengthy divorce battles. In some cases, forensic experts are used for tracking down crypto and determining its value. In short, you are sorely mistaken if you think you can leave out crypto from your divorce.
Typically, cryptocurrency is treated the same way as any other digital asset during an Alabama divorce proceeding. This means your spouse is likely to get a portion of the crypto assets during equitable distribution if you don’t have a prenup protecting it. Prenuptial agreements essentially allow a couple to control their financial decisions instead of allowing a court to step in and take charge.
Prenups also allow couples to make financial decisions early before the breakdown of the relationship. You and your partner can arrive at a more fair and amicable decision. It can also strengthen the foundation of your marriage since you and your partner are on the same page. The best part about prenups is that any future divorce will be streamlined and stress-free.
The bulk of decisions would already have been simplified through the prenup. Prenuptial agreements prevent couples from entering a protracted divorce. It’s critical to remember that prenups don’t mean you are encouraging divorce. Instead, it is a backup plan which can be used when you really need it.
In relation to this, drawing up an enforceable prenup with crypto clauses is not easy. For instance, you need to disclose all your crypto assets before you finalize the prenup.
There may be disastrous consequences if you fail to do so. This makes it important to hire a reliable and accomplished divorce attorney to draft the prenup – someone who has been through the legal battlefields before and knows what it takes to survive a hostile atmosphere.
Prenups Can Determine Clear Ownership of Digital Assets
Prenuptial agreements are useful in determining clear ownership of cryptocurrency. This can be illustrated with the help of an example. For instance, you may celebrate your nuptials by investing in Binance right after your wedding. The investment is small and you have almost forgotten about it. With that said, you are hoping for a future payday.
One day you find out your small chunk of change has skyrocketed into a major investment. Unfortunately, you and your partner decide to divorce later that year, and the Binance assets you own become a sore spot during the divorce proceedings. Crypto assets need to be addressed in the prenuptial agreement because of their high volatility and history of exponential growth.
You and your partner would probably have nothing to fight over had the small investment not skyrocketed. Where crypto assets are concerned, things can go in any direction. You may end up being sorry if you don’t make early ownership determinations. It may just add insult to injury if your partner is awarded a sizeable chunk of the assets with no knowledge or interest in cryptocurrency.
Reduce Divorce and Property Division Costs with a Prenup
Cryptocurrency battles during divorce proceedings can be complicated, which basically equates to expensive in litigation terms. If you and your spouse cannot come to an agreement regarding the division of assets during a divorce, the proceedings will become lengthy. This means you will need to pay for court expenses and attorney’s fees for a much longer time.
You can double that amount if you need to involve forensic experts to value or locate the digital assets. It’s best to have the prenup locked down before you get married if you don’t want to spend all that investment on litigation fees.
A Carefully Drafted Prenuptial Agreement Can Account for Your Post-Marital Crypto Holdings
You and your spouse may not have crypto yet – but may decide to invest in it later. You can decide in the prenuptial agreement that you won’t have any marital or community property. This will allow you to protect any crypto assets that you acquire following your marriage. In addition, you can also choose to get a transmutation agreement or a postnuptial agreement after marriage.
You can use the prenuptial agreement to decide who gets what if a split occurs. You can choose to split your assets 50/50 or keep crypto with yourself while leaving other assets with your spouse. The options are endless when it comes to prenuptial agreements. This is why working with a competent and seasoned family law attorney is vital.
Choose a Knowledgeable Prenuptial Agreement Lawyer in Auburn, AL
The highly rated Auburn, AL family law attorneys at Alsobrook Law Group will help you set up a comprehensive and enforceable prenuptial agreement so that you and your spouse can get through a divorce with as little anxiety and stress as possible. To schedule your free and confidential consultation, call us at 334-737-3718 or fill out this online contact form.