# Question 30: The Wallets Behind the Divorce

## Your role

You represent Mira Sol in a property-division case. Her spouse, Evan, disclosed one cryptocurrency wallet only after tax records exposed it and claims most assets are premarital. Trace the supplied transactions, calculate the marital and separate shares, and identify the discovery still needed for an unexplained second wallet.

## Governing law

Assume the following property rules apply:

1. Property owned before marriage is separate if the claiming spouse traces it by clear records. Property acquired during marriage is presumed marital unless a supplied exception is proved.

2. Marital money used to acquire cryptocurrency creates marital property. Commingling does not automatically destroy a separate claim when the units and later exchanges can be traced.

3. When indistinguishable separate and marital units are commingled and later partially sold without unit-specific tracing, withdrawals and remaining units retain the same proportional separate and marital character as the mixed pool.

4. An exchange from one digital asset to another does not change character. The acquired asset takes the proportional character of the asset surrendered.

5. Appreciation and depreciation follow the underlying proportional ownership unless caused by a separately compensable contribution not supplied here.

6. Proceeds spent on ordinary marital expenses are not reimbursed to either spouse absent a separate agreement.

7. Property found in an undisclosed wallet during marriage is presumptively marital unless the holder traces a separate source. A claimed gift requires evidence of donor intent and transaction source.

8. The valuation date is fixed below. Each spouse ordinarily receives one-half of marital value after classification.

9. If a spouse intentionally conceals marital property in a sworn disclosure, the court may award the other spouse a surcharge equal to 20 percent of the concealed marital property's value, in addition to the ordinary division.

10. Counsel must identify missing exchange, wallet, and donor records before final settlement and may seek a targeted forensic order rather than assume the source.

## Facts

At marriage, Evan owned 8 bitcoin. Complete exchange records prove the premarital ownership.

During marriage, Evan used $120,000 from a joint account to buy 4 additional bitcoin. He combined all 12 bitcoin in one wallet. No unit-specific identifiers distinguish the premarital and marital bitcoin after commingling.

Evan later sold 3 bitcoin. The sale proceeds went to the joint checking account and were spent on ordinary household expenses. He then exchanged 6 of the remaining 9 bitcoin for 90 ether and retained 3 bitcoin. Later transfers moved 30 of the 90 ether to a cold wallet. Both the original and cold wallets are now identified, so the known traced holdings remain 3 bitcoin and 90 ether in total.

On the valuation date:

* Bitcoin is worth $50,000 each.
* Ether is worth $3,000 each.

A second undisclosed wallet contains another 40 ether worth $120,000. Evan omitted that wallet from his sworn disclosure. Tax records show that the 40 ether arrived during marriage from an external address. Evan says his brother gave it to him, but no exchange statements, donor wallet records, gift message, or brother testimony has been produced.

Mira discovered the second wallet through a tax information request. Evan says wallet-to-wallet transfers are too technical to trace and proposes that Mira receive $50,000 to settle all cryptocurrency claims.

## Assignment

Analyze and calculate:

* The separate and marital proportions when 8 premarital and 4 marital bitcoin were combined.
* The character of the 3 bitcoin sale and remaining 9 bitcoin.
* The character of the 6-bitcoin exchange into 90 ether.
* The separate and marital value of the known 3 bitcoin and 90 ether at the valuation date.
* Mira's one-half share of known marital crypto.
* The provisional classification of the second 40-ether wallet.
* Mira's share and the possible concealment surcharge if the second wallet is marital and concealment intentional.
* The exact exchange, wallet, and donor evidence still needed.
* Whether to accept $50,000, settle conditionally, or seek targeted forensic discovery before final division.

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