Can Your Spouse Take Your Crypto in a Divorce?

No two people say “I do” expecting to end up arguing over a hardware wallet in front of a judge. But that’s exactly where a growing number of couples are landing, and crypto has been quietly showing up in divorce court cases for years now, in disputes that look nothing like a standard fight over a house or a pension. A seed phrase can give one spouse total, unilateral control over millions of dollars with no bank or third party able to access it. However, many people assume this means a court could never find it. This article walks through three cases in the UK and the US where crypto became the central issue in a divorce or related property dispute, and shows exactly how each one played out. This article covers general legal principles under US and UK law and is not legal advice. Divorce laws vary significantly by state and country. If you’re going through a divorce involving crypto, consult a family law attorney experienced in digital assets. Case 1 – The Seed Phrase Theft: Yuen v. Li (UK High Court, 2026) Ping Fai Yuen kept 2,323 Bitcoin, worth just under $60 million at the time, in a Trezor hardware wallet secured by a PIN and a 24-word seed phrase. On August 2, 2023, without his knowledge, the entire holding moved to 71 new wallet addresses, and since December 21 2023, the Bitcoin hasn’t moved. Yuen’s case is that his estranged wife, Fun Yung Li, secretly recorded him entering his seed phrase using a home security camera, then used it to drain the wallet, either alone or with her sister’s help. His daughter had earlier tipped him off that Li was targeting his funds, prompting him to install hidden audio recorders. CCTV camera and Bitcoin in a wallet. Source: The Times Those recordings are now part of the public court record. In one exchange from July 29, 2023, a voice believed to be Li’s can be heard asking whether the transfer could be traced back to her: “In that case can he see that the item has been transferred to your…” Two days later, another recording captures apparent confusion over whether the theft had already been detected: “The Bitcoin has transferred to me but can it be seen that you have taken it?” followed by “Oh, it doesn’t know where it was taken to.” Police searched Li’s property and seized ten cold wallets and five recovery seeds. Police arrested her, released her on bail, and later said no further action would be taken pending new evidence, pushing Yuen into civil court. He also pleaded guilty to assaulting Li after confronting her over the theft, a detail that complicates any clean narrative of victim and perpetrator.