Cryptocurrency: Access After Death
There has been an increasing shift toward cryptocurrency over the past decade, and it’s clear this trend is here to stay. However, with its digital, non-physical form comes the danger that it could be lost forever after you die if you don’t make proper post-death access arrangements. That is why it is crucial that when it comes time to break the wax seal on your Will someone has your account credentials.
Perhaps the most popular form of cryptocurrency is Bitcoin, which is basically an online form of cash. There is no central administrator or bank that manages your Bitcoin, instead it is stored in a digital wallet app on your smartphone or computer. Additionally, ownership is not proven by a certificate of title, deed, or account statement as such, but rather an assigned public key, visible to other Bitcoin owners as a means of sending and receiving the “money”. There is also a private key issued which allows the owner access to their digital wallet. Without passing on this private key to someone you trust (most likely the executor of your Will) when you die, no one will ever be able to gain access to your account, and whatever you have in that account will effectively die with you.
As with all your online accounts, it is important that you leave details of passwords, usernames and any other access credentials that may be required, otherwise your executor and/or next of kin may not even know they exist. Cryptocurrency organisations clearly wish to protect themselves and their users by putting in place these robust privacy and data safeguards; they don’t just supply sensitive information to whoever comes knocking at their door. Furthermore, there is likely little commercial value for these types of organisations to grant post-death access, which may explain why so few have such policies in place to facilitate such access.
What is the best way to get this information to your executor or next of kin? Although you may wish to make gifts of your digital assets in your Will, we would advise against leaving access credentials in your Will. Not least because passwords and usernames should be updated from time to time, but also because your Will becomes a public document once probate is obtained. Regardless of the type of digital account, be it an email account, social media account or indeed a cryptocurrency account, we strongly encourage clients to leave separate instructions to their executor and/or loved ones setting out what you want done with these accounts. For example, you may want your online photos to be shared with your family, or email accounts either accessed or deleted right away. There are several options available for how to get this information to those you want to get it to. You could simply leave a written note containing your access credentials together with your Will. There are various forms of online/software wallets to store your usernames and passwords as well. Or you may wish to use an offline physical device, such as a hard drive, SSD card or USB stick. Whatever method you use, just make sure you keep it up to date.
Don’t let your digital assets get lost in the digital abyss after you die. Contact Thompson Budd today to have our specialists put specific powers into your Will so that your executor(s) have the ability to access, control, distribute and dispose of your digital assets.