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Crypto, NFTs, Social Media Accounts, and Domain Portfolios: They’re Assets in a Prenup, Too

Chantale Suttle • February 22, 2023
A man used his phone and laptop computer.

By Jen Rakhimov

 

Any prenuptial or postnuptial agreement is only as good as both partners' integrity in the financial disclosure process. Before signing any marital agreement that pertains to property, both parties need an accounting of what assets they lose when they sign the prenup, as the prenup (or postnup) removes access to what would have otherwise been marital assets. It's unfair to the future spouses to sign a contract that addresses properties, wealth, and debts that are not fully known to both sides.


Consider the process as something analogous to the informed consent doctrine in medicine: before surgery, your surgeon will disclose all the benefits and problems that may result from your surgery. After knowing the worst scenario, you can choose to proceed with surgery or to find other options. Likewise, disclosure between fiancés enable both to see what problems may be ahead (e.g., one partner is being sued) and the range of assets that they will give up through signing the prenup.


If a partner is not forthcoming in providing accurate, thorough disclosure, the
prenuptial or postnuptial agreement may no longer be enforceable if it is challenged in divorce court. While someone might intentionally engage in fraud and/or hiding assets, a partner may not realize something is an asset requiring disclosure, or the partner may simply forget. At JustPrenups, our process is designed to help you avoid this problem. or the partner

 

The items covered in this post are much more volatile than traditional assets, such as a property. Both partners should be aware of this reality: the person who is a paper millionaire in bitcoin at the time of the wedding may have bitcoin that is barely worth anything at the time of the divorce.


While the list below is not exhaustive, the following four assets may be forgotten, as they are not the typical items that most people have in mind when approaching a prenup or postnup. In other words, this ain’t your parents' prenup, and neither is your disclosure.


1. Crypto (cryptocurrency) should be disclosed.


Maybe it's an asset. Maybe it's a liability. Hard to know until you check a headline, or Elon Musk's Twitter, or Lex Fridman’s podcast that day.

 

Either way, crypto should be disclosed to your partner for your prenup (or postnuptial contract). Follow the baseline that JustPrenups encourages as the best practice: be honest, accurate, and specific. When disclosing the value of your crypto, do the following:


a) For our purpose with a prenup, we are most concerned with the fair market value of assets at the time of your disclosure process. List the fair market value of your total holdings and include the date of valuation, unless you have a reason that you want to list different units/coins individually for your records or at the request of your partner, who may make demands during the disclosure process for types of information, additional information, translations, etc. Look at your platform(s) and/or wallet(s) to assess your holdings, and then check another exchange or some reliable market data to validate your findings.


b) List the date and time of the above valuation and the sources used in valuation. Your partner can conduct research as well with this information, especially given that the value of cryptocurrencies can fluctuate wildly. For your peace of mind, your prenup can include a reminder that the value of any asset at the time of financial disclosure may not be the same value at the time of a divorce, but assets will nonetheless remain non-marital property.


c) For additional clarity and transparency, identify the type of crypto and the number of coins/units. We realize that you will continue to buy and sell, just as you may buy another home, a boat, more stock, etc. after the prenup is signed. That's okay because life goes on. Financial disclosure is designed to give the best financial picture possible at the time of signing the marital contract.

 

For those with an interest in creating your own crypto, either currently or in the future, your prenup should cover this business so that you hold all intellectual property ("IP"), including the coin itself. You might be the next Dogecoin maker, but your divorce can impair your financial success unless your prenup offer specific protection.

 

2. NFTs (non-fungible tokens) should be disclosed.

 

A client recently asked how to value a portfolio of NFTs. Much of the advice above for crypto applies to NFTs as well. 

 

An NFT is a digital asset that can include, for example, visual art and music. Each NFT is verified via a blockchain, which is a decentralized digital ledger or “database” that indexes the NFT as unique, meaning that there isn’t any other digital asset exactly comparable to that particular NFT. For example, you can exchange three dollars for three different dollars, and the value is still the same because dollars are a fungible asset. In contrast, each NFT is uniquely valued depending on its popularity and history, among other factors. The blockchain verification stops people from replicating an NFT and trying to sell it or to use it as an original. Once the NFT is sold to a buyer, the buyer is identifiable and recorded via the blockchain.

 

a) The first step in listing any asset in disclosure is to determine the fair market value: look at the current sale price of comparable NFTs at more than one reliable marketplace.

 

b) Describe the NFT as clearly as possible in plain language so that there is no confusion in the event of divorce. Remember, you need to consider that you may face a judge who needs you to make the assets easily identifiable so that time isn't wasted in any disputes. Generally, the NFT will have a name and some unique identifier(s) that set it apart.

 

c) Always provide the date of valuation for your assets. When did you research and find the value of the NFT(s) that will be listed as assets in your prenup? Include that information in your disclosure worksheets that we provide as part of our process.
 
 

If you are an NFT creator, even as a hobby that happens to make income occasionally, you are a business owner, and your prenup should be drafted as such. If you are an NFT creator who has not profited, you have still created IP that may be potentially lucrative even if it isn't right now. Your prenup should address these actual and potential NFTs as well as any other IP you may have, such as that script sitting in your drawer, your plan for a future business that is sitting in your desktop, and your application for patent. While these items are not what you traditionally think of as "prenup worthy," they are just as important as your home and your 401(k) since they hold current and future value.
 
 

3. Business-related and/or income-producing social media accounts and handles are intellectual property that require protection as assets. 
 
 

Your social media holds value as an asset. Your LLC might have several accounts across different types of social media using the same handle on all of them: make sure your hard work pays off so that these items remain yours both during and after the marriage. Any business interest, all business inventory, all business assets, and all business-related IP should be protected in your prenup (or postnup) as much as the business itself.

 

Additionally, you may have a personal social media account that has enough followers to interest advertisers. If you accept payment for promoting on any of your social media accounts, those accounts are now business accounts, as you are using them to produce income, and you are a business owner. These accounts, personas, and handles need the same protections in a prenup as those associated with a corporation, even if you didn't set out to make your social media a money-making endeavor. Enjoy your success, build it, and make sure it stays yours.
 
 

a) As above, provide a valuation of your social media account(s) and handle(s), and list your method of reaching that value. Are you finding an average revenue over recent years from sales or advertising? Do you translate the number of followers into a fair market value for your social media account? Does the value include the amount of website traffic generated or leads generated? Should the value include something that's harder to quantify such as brand awareness?

 

There isn't a right answer among the methods listed above. But there is a right answer for your financial disclosure for the prenup: what is satisfactory to your partner, who needs to know exactly what assets or what value will be omitted from marital property holdings? Think about which valuation method fits your social media and handle(s) and think about why it fits so that you can articulate why that valuation method yields the most accurate result. Record this information and your date of valuation in the disclosure worksheet that JustPrenups provides.

 

b) Identify the social media types and the handles associated with your accounts. If you have been changing the presented name or other identifiers, claim those as well.
 
 

c) Remember that your prenup can include provisions that punish your partner for bad behavior on the internet pertaining to you, your business(es), your reputation, and your social media. Nothing is worse than ugly drama left on someone's wall by an angry ex. Prenups can be drafted to address such potential bad behavior before it happens and to provide incentives to avoid acting out.
 
 

4. Domain Name Portfolios should be disclosed as an asset.


This asset, like the other above, may be difficult to value accurately. Prenups and postnups are invalidated when there is a lack of good-faith disclosure or the failure to name an item, whether tangible or intangible. Your best bet for complicated assets is transparency. If needed, check in with your financial advisor or CPA for advice for any of the items that you disclose.

 

a) State how you valued your domains and what they are. Consider the fair market value listed on reputable sites. Evaluate the uniqueness, potential revenue generation, and market demand for a particular domain name. Would the domain make a great brand name? Is it short and easy to remember? Is it a clever pun? Research the market demand for comparable domain names and the pricing; try using websites such as NameBio or DNJournal to assist.

 

b) Remember the value can happen in more than one way. There is the sale value of the domain name, but you can also generate revenue through leasing or licensing the domain name. You might start a website and/or business relevant to a domain name that is trending and then sell the whole package. Be clear about how (i.e., the method and why you’re choosing that method) you’re valuing your domain portfolio once you have totaled your numbers.


c) Consult your attorney, mediator, or financial professional to see how much detail should be included in your disclosures. Check with your partner to see what is satisfactory disclosure. When you have greater detail, you have greater transparency; as a result, the disclosure is more robust, which means your marital contract has strong enforceability if challenged in divorce court.


d) When all else fails, or when valuation seems too ambiguous, ask if your partner wants a professional appraisal on this or any item. Document such requests for more information and offers of additional information related to disclosure, and document how these requests were resolved.


To learn more about prenups and postnups, schedule a free consultation with us.

 

Warning: All posts on this website and its partner website, DADvocacy.com, contain general information about legal matters for broad educational purposes only. This information is not legal advice and should not be treated as such. This blog post does not create any attorney-client relationship between the reader and the DADvocacy™ Law Firm or between the reader and JustPrenups.com.

 



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By 7107328235 March 27, 2025
A prenuptial or postnuptial agreement can save your business. Consider two dry cleaners, Ricky and Fred. Both thought they would be married to their wives until “death do they part.” Unfortunately, they both ended up divorced. Ricky walked out of divorce court personally and professionally ruined. Fred, while emotionally drained, was able to maintain and grow his successful business. Why the different outcomes? Ricky’s Story Ricky owned a dry cleaning business with Lucy, his wife of 19 years. Ricky was in charge of all aspects of the business, but Lucy did manage the company’s payroll and vendors part-time. Occasionally, she worked the front counter. For the most part, Lucy raised the children and cared for her elderly parents. When they decided to divorce, Ricky and Lucy were still civil and wanted their divorce to be amicable. Ricky and Lucy worked together, without lawyers, to craft a plan for sharing time with their teenage sons, and for sharing the family’s expenses. They also agreed to sell their house after their youngest son graduated high school. After a few months, and at the urging of a well-intentioned friend, Lucy hired a lawyer to write up the couples’ plan. Lucy’s main goal was to make sure the divorce ended fairly for her children. The lawyer, however, believed that since any small business owner could hide income, assets, or a company’s true value, then Ricky must be doing that too. Even though Lucy had a base of knowledge of the business’s finances, she trusted her lawyer and figured that he knew better. So, she agreed to his “scorched earth” strategy to protect her children. What is a “scorched earth strategy”? This is a common tactic to squeeze a business owner into a large and early settlement. The lawyer hires an accountant, and they go after every scrap of information and document pertaining to the company’s assets and liabilities, and they question it all—every argument and angle of attack is fair game. Much of the cost of providing the information and documents, and defending business decisions, must be paid by the business. Scared and desperate, Ricky lawyered up too. Unfortunately, Ricky’s lawyer couldn’t advise him on the settlement terms proposed by Lucy’s lawyer without conducting his own analysis of the company’s voluminous records. Much of the paper work involved in operating a dry cleaning business was foreign to him, and the stringent environmental regulations and reporting was overwhelming. Ricky’s lawyer had to hire his own accountant to help value the business for the divorce. Ricky and Lucy were now far from civil with one another, and the mud began to fly. Faced with dueling accountants, complicated and conflicting arguments about the business’s finances and value, and accusations against Ricky of financial wrongdoing, the family court judge appointed an independent forensic accountant to advise the court. The independent accountant saw that the business, which was the couple’s biggest asset, was crumbling because the ugly divorce was keeping Ricky from focusing on the business. The accountant was also worried about the accusations of financial wrongdoing by Ricky. So, on the independent accountant’s recommendation, the court appointed a receiver to operate and protect the dry cleaning business. Ricky and Lucy were now paying six different professionals, and trial was still months away. The receiver discovered that the company’s records did not comply with dry cleaning waste disposal regulations, and reported the non-compliance to government authorities. Ricky and Lucy blamed each other for the missing paperwork, and the sour relationship between them stalled and ultimately prevented joint efforts at an amnesty program and damage control. The business began to accrue daily statutory fines, employees were laid off, debts mounted, and the business eventually shut its doors while Ricky and Lucy continued to fight in divorce court. A year later, with no business to provide income for Ricky or Lucy, Ricky agreed to settle by paying Lucy more than half of his share of the house. Lucy accepted the offer, even though it was smaller then what she expected originally, because her share of the house was pledged to pay her lawyer’s fees. Fred’s Story Fred was married to Ethel for 22 years, and they have a daughter. Like Ricky and Lucy, Fred ran the business while Ethel was involved part-time in just certain aspects. But unlike Ricky and Lucy, when Fred bought his dry cleaning business nine years earlier, Fred and Ethel signed a postnuptial agreement to protect each other in case of divorce. The attorney-drafted agreement laid out a strict structure for evaluating and dividing the business, and for determining Fred’s true income for spousal and child support calculations. It identified and limited the financial information and documents that the business would have to disclose. It also required that the couple use a single neutral accountant (who would be paid from marital property and not by the company), to gather and evaluate that financial information and documentation. Early in the divorce, Ethel agreed that the postnuptial agreement was valid. She waived any right to ask the court to force the company to disclose more information or documents than described in the postnuptial agreement. This entitled Ethel to an immediate, fair, and higher award of support, thanks to a provision that she and Fred put in the agreement to encourage a quick resolution. Within a month, Fred and Ethel’s divorce was finalized, with minimal attorneys’ and accountant fees, and with no interference or intrusion into the dry cleaning business or operations. How could two similarly situated businesses and families leave divorce court with such different results? The first story is horrifying, but exceedingly common. Many states have onerous disclosure requirements that unnecessarily burden the time and finances of a small business. Unscrupulous divorce lawyers are trained to hone in and target a business owner’s fear of having the business’s confidential and financial information exposed to the world, to induce an early and usually unfair settlement. Fair and careful divorce lawyers will also want extensive company records, because they fear being liable for giving bad advice if they make recommendations without investigating the whole picture themselves. Either way, good lawyer or a bad one, smart judge or not, a case involving a small business can be very costly. The best way to avoid being a Ricky, is to get a prenuptial or postnuptial agreement like Fred. A good prenuptial or postnuptial agreement can render the most intrusive and damaging financial disclosures unnecessary, and can limit or attribute the related costs away from the business. In some situations, as shown above, they can save the business itself. If Ricky had a prenuptial or postnuptial agreement in place, maybe a receiver would not have been necessary, and Ricky and Lucy could have resolved the business’s regulatory problems confidentially without going out of business. Ricky and Fred were not wrong to believe in their marriages. A life-long commitment is not fanciful; it is a hopeful and beautiful goal. Most couples think they will reach that goal and that other couples will fill our country’s depressing divorce statistics. But consider this, we buy life insurance, install security systems, and wear seat belts “just in case.” They give us security even if we think that odds will always be in our favor. A careful and thorough prenuptial or postnuptial agreement can provide you, your spouse, and your business with security that all will be protected in a divorce, and that years of building a life and a business will not be burned to the ground. Chantale Suttle is the Managing Attorney and Founder of DADvocacy™ Law Firm, which is headquartered in Miami, Florida. She has been in the exclusive practice of family law for over 21 years and has served countless small business owners in divorce court. Drafting prenuptial and postnuptial agreements for small business owners is her favorite work.
A couple sits on a bench as one person reaches out to the other who is turned away.
By 7107328235 January 15, 2025
Your fiancé or fiancée presented you with a prenuptial draft: will you sign it before you hear wedding bells? Now you need a review by an attorney to ensure that your assets and your future security are protected: welcome to JustPrenups' prenup review! JustPrenups now offers UPLOADR: quickly share your prenup draft easily from any device in multiples format through UPLOADR on our site - no scanning, no email. Once we receive your prenup draft, an attorney examines the prenup that you received and then meets with you for a free consultation on Zoom. We hold your document and its data in confidence, even if you don't retain us, per our ethical requirements.
A couple walks along a Florida beach by the water in sunshine.
By 7107328235 December 26, 2024
Florida is a quirky place full of contrasts, and so is its family law. In particular, recent updates to Florida family law have changed the rules for alimony in Florida prenups. If your prenuptial agreement doesn't follow these changed rules, your prenup may not be valid and enforceable; as a result, you may be facing high financial stakes in divorce litigation that may put your assets at risk.
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