Modern divorce cases are far more complex today than they ever have been. Not only are traditional physical assets included in proceedings, but digital ones too. Assets such as cryptocurrency and NFTs are now on the table during proceedings. As digital assets increasingly become common, they appear more and more often in Michigan divorces. Many couples now invest in crypto, use online brokerages, or run income-producing digital ventures that may hold significant value in marital property division.
Michigan courts treat digital property like traditional assets, classifying it as marital when acquired during the marriage or when premarital assets grow through marital efforts. It is up to the courts to examine when the asset was obtained, how it was funded and how much each spouse contributed to its funding and growth. This can be difficult due to volatility and tracing challenges associated with encrypted and blockchain digital assets. Working with an experienced legal team specializing in high value divorce can be critical to verify these details.
How Michigan Courts View and Evaluate Digital Assets
Courts in Michigan apply equitable distribution rules to digital assets, determining whether they are marital or separate based on when they were acquired, how they were funded, and any contributions to their growth. Any assets gained or increased during the marriage are usually considered to be marital. Typically, the courts rely on documentation such as transaction histories, wallet records, account statements, and exchange data to determine this.
After digital assets are classified as marital, courts must determine their value. For cryptocurrency, this is typically valued using fair market prices from reputable exchanges on a specific date but volatility can make this difficult. Digital businesses on the other hand may require income or market based valuation methods, which can be challenging in situations with fluctuating income or limited comparables. Because digital assets often change rapidly and can be hard to trace, expert valuation reports are frequently necessary for accuracy.
Disclosure Requirements and Locating Hidden or Overlooked Digital Property
Under Michigan law, spouses are required to provide full financial disclosure in divorce, including all digital assets. Cryptocurrency, digital wallets, online investment accounts, and digital business income must be reported like any traditional asset for the purposes of property division. If it is suspected that digital assets are being withheld, they can often be identified through bank transfers to exchanges, tax records showing digital activity, online revenue reports, and blockchain data. Such evidence helps determine whether digital property exists and should be included in the marital estate.
During disclosure, courts and attorneys will look for signs that digital assets may be hidden, including unexplained withdrawals, use of crypto friendly apps, a history of interest in blockchain technology, or inconsistent income reporting. When these issues appear, forensic specialists can trace transactions across exchanges, recover deleted data, and link blockchain activity to specific accounts. Once discovered, they also can help value digital assets with incomplete records or volatile pricing.
