Asset Protection: Should You Care About Bitcoin?
In the past year, Bitcoin has become a household word. If heading for divorce, should you care about alternative currencies?
During 2013, the United States Senate began an investigation into the value and theory of alternative currencies like Bitcoin. Despite wild fluctuations in price, an agent for the Secret Service testified at a November hearing before the Senate “[t]here are plenty of opportunities for digital currencies to operate within existing laws and regulations.”
Whether Bitcoin can hold value and serve as a reliable medium of exchange in the future remains to be seen. It seems likely Bitcoin or another currency may take hold, providing novel financial services that become standard as PayPal did in the past.
So what does Bitcoin have to do with divorce?
Hiding assets during divorce is nothing new. Money may be surreptitiously removed from the divorce process through a number of means, including:
- Hidden financial accounts created to hold wealth
- Delay of bonus or wage increases
- Overpayment of tax obligations
- Money funneled into purchase of valuable objects
- Funds siphoned to family and friends until after divorce
During divorce, both parties are required to disclose all assets. Spouses inclined to hide money may not be deterred by legal requirements, but at present, there are real roadblocks to using Bitcoin to hide marital wealth, including:
- Variable value. Money invested in Bitcoin may not hold value for a spouse attempting to hide assets.
- Difficulty of exchange. If transferred to another holder, Bitcoin may be difficult to retrieve.
- Lack of regulation. There is little legal recourse if a Bitcoin transaction goes bad.
Should you be concerned with alternative currencies? If you suspect your spouse is moving money off the table, investigation is important. Talk to us at Bryan L. Salamone and Associates, P.C. for aggressive legal service.