Does Your Estate Plan Address Cryptocurrency?

Does Your Estate Plan Address Cryptocurrency?- Cryptocurrency isn’t the only digital asset your estate plan needs to address. However, it may be the one with the most value. If your estate plan doesn’t address digital assets, or if your executor has no idea how to deal with digital assets, your digital millions could disappear. A recent article from Barron’s, “You Struck It Rich With Bitcoin. How to Leave It to Your Heirs,” explains what you’ll need to do if you want to pass your digital wealth to loved ones.

Cryptocurrency owners use a variety of tools to ensure that their assets are not easily accessible. This is vital because Bitcoin is a bearer asset, meaning whoever has the asset owns it. Strong protection is great while you’re living. However, if your estate plan isn’t ready, your heirs may never see any of it.

Think of the difference as if you were trying to locate the keys to your late mother’s apartment, versus trying to get past the facial recognition software on her phone after she’s been buried.

How you own your digital currency will make a big difference in what your executor must do to gain control of it. If they are indirectly owned through exchange-traded funds (ETFs) or stocks owning cryptocurrency, your executor will access them in the same way they would any other investment account.

If you store coins on cryptocurrency exchanges, your executor will need to access the account. You can share your private keys with heirs, or if the exchange permits you to name beneficiaries for an account, follow the instructions provided by the exchange. Please note that not all exchanges offer this feature.

For the most part, however, cryptocurrency remains the Wild West, and you must protect your property yourself. Don’t expect your executor to be able to navigate this relatively new world unless they have all the necessary information. There’s no 800 number to call and no paper trail to follow.

You’ll need to provide them with a list of coin names, the number owned and their location: on an exchange, in a digital wallet, or stored offline in a physical device. They’ll need to know how to access private keys or seed phrases.

Does Your Estate Plan Address Cryptocurrency?

If your coins are stored on your mobile phone or laptop, they’ll require information to unlock these devices. If you use a biometric lock for your phone, such as facial recognition or fingerprint recognition, you’ll need to create an alternative means of accessing the device.

Passwords to access cryptocurrency exchanges, digital wallets and those required to access email accounts and authenticator apps used for multifactor authentication will also be needed.

This is not simple stuff for those who aren’t involved in crypto and digital assets on a regular basis. You’ll need to name a digital executor who is familiar with the world of cryptocurrency and then prepare them for their responsibilities.

Finally, don’t include any access information in your will. Once the will is admitted to probate, it becomes a public record. Talk with your estate planning attorney about creating a separate document containing this information to be shared with your digital executor. Ensure that your digital executor is prepared for this task and appoint a successor in case they are unable or unwilling to serve when the time comes.

If you want your heirs to reap the benefits of your forward-thinking investments, these resources need to be in place and planned for as part of your estate plan.

Schedule your phone consultation: THE LAW OFFICES OF CLAUDE S. SMITH, III

Does Your Estate Plan Address Cryptocurrency?

Reference: Barron’s (June 14, 2025) “You Struck It Rich With Bitcoin. How to Leave It to Your Heirs”