3 important points on cryptocurrency and estate planning

06 Sep, 2018

On Behalf of Mack & Mack Attorneys | estate planning

It is becoming more and more common for individuals to own a fair amount of digital assets. Examples include bitcoin and other cryptocurrencies.

As with other types of property, it can be critical for people to give thought and attention to what will happen with any cryptocurrency they own when they pass away. Today, we’ll go over three important estate planning considerations when it comes to such assets.

Making your ownership of such assets known

When a person passes away, it is important that his or her personal representative knows all of the property that is in the estate.

Cryptocurrencies could be more likely to slip through the cracks in this regard than physical assets. This could lead to such assets never being passed onto heirs, and instead just lying dormant.

So, it can be important for people to take steps to ensure this won’t happen with their cryptocurrency in the future. One thing that can be done on this front is to make a list of cryptocurrencies one owns, and put the list in a place that is safe and would be readily accessible by a personal representative in the future. It can be important to keep this list regularly updated.

Making your wishes known

If a person who owns cryptocurrency dies without making his or her wishes for what will happen with these digital assets clearly known in an enforceable form, it could open the door to long and complex legal battles within his or her family about how these assets will be divided under state law.

So, it can be critical for individuals to make sure to include cryptocurrencies they own in their estate planning. Estate planning documents can allow a person to provide clear and enforceable instructions as to how such assets are to be distributed upon his or her death. Skilled lawyers can help individuals with estate planning issues involving digital assets.

Making such assets accessible

Now, for such wishes to be properly followed through on, the cryptocurrencies in question have to be accessible after a person death. This could prove impossible if a personal representative doesn’t have the right information, such as the crypto keys and security codes related to the assets. So, along with making a list of the cryptocurrencies one owns, making (and regularly updating) a list of the access information for these digital assets can be an important estate planning step.

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