Yes, absolutely. Cryptocurrency is an asset, sometimes of significant value, and the Family Court have powers to make orders against it on divorce.
When negotiating how to divide the finances on divorce, both you and your spouse are under a duty to provide full and frank disclosure of your assets - and this will include digital assets, such as cryptocurrency.
If you are the person disclosing your cryptocurrency, in order to save time and legal costs you should be upfront about your assets and provide the public keys for your crypto wallets and 12 months transaction history. The public key will provide access to information about the assets held, and the transaction history is like a bank statement. The value may change drastically due to the volatile nature of the currency, and therefore regularly update the values and agree a value before any court hearings or settlement negotiations.
Due to its virtual nature, it can be complex to trace. The first place to look is traditional bank and credit card statements, where your spouse may be transferring standard currency (known as 'fiat' in crypto language) onto a cryptocurrency trading platform.
Whilst many hold their cryptocurrencies on an online trading platform, it can also be held in a 'Cold Wallet'. This is where all the information held offline, usually on a USB stick called a ' Nano Ledger', or even written down on paper. Consider if you can recall your spouse talking about this or if you have seen a Nano Ledger at home. However, if you do not have any evidence, it may be very difficult to ever find a cold wallet.
Cryptocurrency can be 'mined', which can be a source of income for those taking part. People who mine cryptocurrency are helping the Blockchain move along in return for a reward (acting as the verifiers in the analogy above).
These days, mining is usually done by businesses with huge numbers of computers and most people are unable to do it from their living rooms as they did in the early days of cryptocurrencies. However, if your energy bills at one point were excessively high, perhaps your spouse had lots of computers, or you recall discussions about rewards or mining, this could suggest someone was mining cryptocurrency.
Tax returns should be carefully analysed, as if the cryptocurrency is producing an income or is being received from an employer, it should be declared as such on the self-assessment.
Ultimately, non-disclosure of assets in financial negotiations is a criminal offence, and therefore hiding assets poses a serious risk to the non-disclosing party.
If initial investigations and questions do not locate any cryptocurrency and you still believe your spouse has crypto-assets, forensic accountants and cryptocurrency specialists can be instructed to investigate.
If the parties agree that the cryptocurrency is to stay with its original purchaser, it will still be recognised as capital (and potentially income) that they have access to. It could then be offset against another asset.
Cryptocurrency can also be transferred from one party to another, or shared. In this case the coins can either be transferred into 'fiat' or the receiving party could open up their own cryptocurrency trading account to receive the coins.
Parties must take specialist tax advice if transferring cryptocurrency as this may give rise to Capital Gains Tax.