More divorces now involve crypto. Courts treat it as shared property. But the private key must stay whole to keep access secure.
- Crypto is seen as marital property in many countries.
- Private keys can’t be split without losing funds.
- Secure tools exist to share access fairly in legal cases.
Why a Private Key Cannot Be Split
A private key is a secret code that lets you control your cryptocurrency. It must stay fully intact. If even a single letter or number is changed or lost, you may never get your crypto back.
During divorce, some people think they can each take half of the key. But that’s risky. A private key is like a password. Cutting it in half makes each part useless. Trying to split it manually can lock you out of your funds forever.
Ways to Share Crypto Legally and Securely
Shamir’s Secret Sharing
This method breaks a private key into several parts, called “shares.” You can choose how many shares are needed to rebuild the full key. For example, 2 out of 3 shares might unlock the wallet. Spouse A, Spouse B, and a lawyer can each hold one share. This setup protects against loss and gives control only when people agree.
Multisignature Wallets
Multisig wallets need more than one person to approve any transaction. You decide how many keys there are and how many must agree to send crypto. In a 2-of-3 setup, Spouse A, Spouse B, and a third party each hold one key. Two of them must agree to move funds. This helps ensure fair access and prevents one person from acting alone.
Custodial or Legal Agreements
If trust is low, a neutral third party can hold the private key. They release funds only under legal rules both spouses agree on. This method gives confidence that no one can cheat or hide assets.
Tracking and Valuing Crypto in Divorce
Even though crypto feels private, it can be tracked. Courts may use forensic experts to find hidden wallets. Because it’s now common for couples to own crypto, laws treat it the same as homes or savings. Both sides must report what they own honestly. If the value isn’t clear, courts may use the average price or set a date to decide it.
Other Uses Beyond Divorce
Tools like Shamir’s Secret Sharing and multisig wallets also help with inheritance or business deals. Families use them to make sure crypto is passed on safely after death. In companies, they protect funds by requiring more than one person to approve any move.
Source: cointelegraph.com