Imagine sitting across from your soon-to-be ex-spouse in an asset division session. You’re going through the usual list of assets—home, cars, savings accounts, etc.—when suddenly, the phrase “No, not my Bitcoins!” gets thrown into the mix. You pause, realizing digital assets are as tangible and valuable as the house or cars you’re fighting over.
In today’s world, digital property has become a significant part of many divorce proceedings, and dividing it can be just as complicated—if not more—than traditional asset division. So, how are digital assets divided in a Texas divorce? In this blog, we’ll consider the definition of digital assets and how to divide them fairly.
What Are Digital Assets?
Digital assets refer to any virtual or online properties that hold value. Such properties can include:
- Cryptocurrency
- Online banking or investment accounts
- Domain names
- Social media profiles
- e-books, digital photos, or other intellectual property
- Video game accounts
In a Texas divorce, these assets must be accounted for and divided like any other marital property.
How Are Digital Assets Divided?
Texas follows a community property system, meaning that any assets acquired during the marriage, including digital assets, are typically considered marital assets and subject to a just and right split between spouses. However, assets acquired before the marriage or those regarded as separate property, such as an inheritance, are not subject to division.
While digital assets are divided similarly to physical assets, several factors can make them difficult to divide. For example:
Cryptocurrencies can fluctuate wildly in value
This makes it challenging to agree on their actual value.
Tracing and identifying digital assets can be tricky
Some spouses may attempt to hide them in encrypted wallets or obscure online accounts.
Some digital assets cannot be easily divided
Online businesses or valuable social media profiles present unique challenges. In these cases, one spouse may retain ownership while compensating the other with an offset in value elsewhere in the settlement.
Working with competent financial advisors and trusted legal experts experienced in digital asset division is essential to ensuring a fair distribution of assets during a Texas divorce.
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