A common story goes something like this. Three hundred thousand dollars moves out of a joint offset account. By the time the other person finds out, it has gone into cryptocurrency, and by the time anyone asks properly, the explanation is that it was lost in a scam.
Now it is settlement time, and one party is offering to split what is left down the middle as though none of that happened.
Here is how Australian family law actually deals with digital assets, including when they have gone missing.
Crypto Is Property, Not A Loophole
Start here, because a surprising number of people assume otherwise. Cryptocurrency is treated as property in a family law settlement, exactly like a bank account, a car or shares.
It goes into the asset pool. It gets valued. It gets divided. The fact that it lives on a blockchain rather than in a bank changes the practical work involved, not the legal principle.
The same goes for other digital assets. Tokens, stablecoins, exchange balances, staked holdings, non fungible tokens and even meaningful online business or gaming assets can all form part of the pool.
The Disclosure Duty Covers It
Both parties have a duty of full and frank financial disclosure, and it is not limited to the things that are easy to find. The obligation is ongoing and applies to everything relevant to the financial picture.
What Has To Be Disclosed
- Every exchange account, including ones opened and closed during the relationship.
- Self custody wallet addresses and holdings.
- Transaction history showing what was bought, sold and moved.
- Crypto held through a company, trust or self managed super fund.
- Holdings in someone else’s name that are effectively controlled by a party.
- Income received in crypto, including staking and mining returns.
If They Will Not Disclose
Non disclosure is not the safe play people imagine. A court can draw inferences adverse to the person hiding information, which in practice can mean the court proceeds on the basis that undisclosed holdings exist and are worth something. Costs orders and setting aside a settlement obtained on false information are both possible.
Our guide to financial disclosure obligations covers what each side must produce and what happens when they do not.
It Is More Traceable Than People Think
This is the single biggest misconception, and it matters because people make bad decisions based on it.
The Ledger Is Public
Bitcoin and most major blockchains record every transaction on a public and permanent ledger. Anyone can look up an address and see what moved, when and to where. Crypto is pseudonymous rather than anonymous, which is a very different thing.
The Exchange Trail
Getting Australian dollars into crypto almost always means passing through a regulated exchange. Digital currency exchange providers must register with AUSTRAC and comply with anti money laundering and know your customer obligations, which means verifying identity and keeping records.
That is the link between a real name and a blockchain address, and it is the reason most crypto in family law matters is found rather than lost.
Subpoenas
Where someone will not produce records voluntarily, the court can issue subpoenas requiring third parties to hand over documents. Exchanges, banks and accountants all fall within that.
Bank statements are usually the starting point, because the money almost always leaves a bank account before it becomes crypto.
| Where to look | What it usually shows |
|---|---|
| Bank and offset account statements | Transfers to exchanges, which name the platform |
| Tax returns | Declared capital gains or losses on crypto |
| Exchange account records | Deposits, trades, withdrawals and destination addresses |
| Email and app notifications | Account confirmations and platform names |
| Devices and password managers | Evidence that wallets exist, and which ones |
| Accountant records | Advice sought, and holdings reported |
Valuing Something That Moves
Crypto prices move a great deal, and that creates a genuine problem in a process that takes months.
The general position in Australian family law is that property is valued at the time of the hearing or settlement rather than at separation. For a volatile asset, that means the number everyone is arguing about is a moving target.
There are practical ways to deal with this. The holdings can be sold and the proceeds divided, which removes the argument entirely. They can be split in specie, so each party takes a proportion of the actual coins and each carries their own risk. Or the value can be fixed at an agreed date, with everyone accepting the consequences of movement after that.
Each approach suits different circumstances, and our note on valuations in family law property disputes covers how contested values get resolved more generally.
When The Money Is Gone
Wastage
This is where the law has recently become much more useful. Changes to the Family Law Act commencing on 10 June 2025 require the court to consider the effect of wastage, meaning property that one party has intentionally or recklessly dissipated.
Speculating heavily with joint savings without the other person’s knowledge is exactly the kind of conduct that raises it. So is doubling down after losses, or moving money out of an offset account quietly.
Wastage is generally reflected in the overall adjustment rather than by pretending the money still exists. It does not conjure funds back, but it does mean the loss is not simply shared equally as though it were bad luck that happened to both of you.
When It Was A Scam
Crypto investment scams are a serious and well documented problem in Australia, and investment scams consistently account for a large share of reported losses. Plenty of people genuinely are defrauded, and being a victim is not the same as being reckless.
But two questions still need answering honestly. Was the decision to put that much into that platform reckless in the circumstances. And is the money actually gone.
That second question is worth taking seriously rather than assuming. A claimed scam loss is still traceable on the ledger, and it is not unheard of for funds said to be lost to be sitting in a wallet the other party still controls. Tracing is a specialist exercise, but the starting evidence is usually available.
The Tax Trap
This one catches people out after the settlement is signed, which is the worst possible time.
The ATO treats crypto assets as capital gains tax assets, so selling or otherwise disposing of them can trigger a CGT event. A settlement that hands one party the crypto and the other the cash can therefore be far less equal than it looks, because one of them is carrying an unrealised tax bill.
There are rollover provisions that can apply to transfers between separating spouses, and whether they apply depends on how the transfer is structured. This is genuinely specialist territory, so get tax advice before agreeing to who takes what rather than afterwards.
The Problem Of Who Holds The Keys
Crypto in a self custody wallet is controlled by whoever holds the private keys or the recovery phrase. Without them, the holdings cannot be accessed by anyone, including a court.
An order that someone transfer crypto they refuse to hand over is only as good as the enforcement behind it. In practice this often means structuring the settlement so the other party receives value from assets that can actually be compelled, such as the house, superannuation or cash, rather than relying on a transfer of coins.
It is a practical point rather than a legal one, and it is frequently the difference between an order that works and an order that does not.
The Joint Account Problem
Worth a short detour, because it is the step that would have prevented a great many of these situations.
Many joint accounts, including offset accounts attached to a joint mortgage, are set up so either person can move the entire balance without the other’s approval. Most people never think about it until something goes wrong, and it is frequently not offered as a choice when the account is opened.
Banks can generally set accounts to require both signatures for withdrawals above a threshold. If you have significant joint savings, that is a conversation worth having with your bank.
If You Receive A Formal Offer
A settlement offer that arrives labelled as a Calderbank offer is doing something specific. A Calderbank offer is made without prejudice save as to costs, which means that if you reject it unreasonably and then do worse at hearing, the other side can use it to seek costs against you.
That does not mean you have to accept it. It means you should not dismiss it without advice, because the costs consequences are real.
It is also fair to note the practical tension here. Legal costs are significant, and where the pool is modest, a negotiated outcome usually beats a contested hearing on pure arithmetic. That is a reason to negotiate from an informed position, not a reason to accept an offer made before disclosure has even happened.
What To Do Next
If crypto is part of your separation, the order of operations matters. Get disclosure first, work out what actually exists and where it went, then talk about splitting it.
Our overview of separation sets out how the process fits together, and our property settlements page explains how we approach matters where assets are contested, hidden or hard to value.
Bring what you already have. Bank statements showing transfers out, any exchange names you recognise, tax returns and anything showing what was held and when.
The Short Version
- Cryptocurrency is property in a family law settlement and goes into the pool like anything else.
- Disclosure obligations cover every wallet, exchange account and token.
- Blockchains are public and permanent, so crypto is pseudonymous rather than anonymous.
- Australian exchanges must register with AUSTRAC and verify identity, which creates a paper trail.
- Courts can subpoena exchanges, banks and accountants for records.
- Property is generally valued at settlement rather than separation, which is awkward for a volatile asset.
- Since 10 June 2025 the court must consider wastage where assets were dissipated recklessly or intentionally.
- A claimed scam loss can still be traced, and should be.
- Crypto is a CGT asset, so who takes it matters more than it appears.
- Whoever holds the keys holds the coins, so settlements need to be structured around what is enforceable.
The technology is new. The principle is not. Assets get disclosed, valued and divided, and conduct that destroyed value does not simply disappear from the calculation.
The above is general information about Australian family law and is not legal or tax advice. Outcomes depend heavily on individual circumstances, and you should obtain advice about your own situation.