Legal and cryptocurrency experts are highlighting secure approaches to dividing control of Bitcoin and other digital assets during divorce proceedings, noting traditional key-splitting methods are technically unworkable. A private key cannot be split while retaining functionality, as dividing it renders the entire wallet permanently inaccessible.
Shamir’s Secret Sharing (SSS) offers one solution by distributing a private key into multiple shares. Access requires reassembly using a predefined number of these shares, enabling conditional control beneficial for divorce agreements or inheritance plans.
Multisignature wallets provide another mechanism, mandating authorization from multiple key holders for transactions. This prevents unilateral asset movement and ensures mutual consent, aligning with equitable division requirements in marital dissolutions.
Custodial services or legal escrow arrangements represent a third option, where neutral third parties safeguard assets until settlement terms are fulfilled. This prevents premature transfers and upholds court-mandated distribution fairness.
Notably, despite cryptocurrency’s pseudonymous reputation, all blockchain transactions remain publicly traceable. Courts uniformly treat crypto assets as divisible property subject to standard settlement adjudication.