What Are Crypto Assets?
Crypto assets are digital assets or rights that have value and are transferred or stored electronically using a distributed public ledger called blockchain. Crypto assets include cryptocurrency, which is digital money that is recorded on a blockchain rather than being held by a bank, and other types of assets such as NFTs (non-fungible tokens). NFTs are unique digital works such as artwork, music, domain names and collectibles that can be bought and sold.
How Can My Crypto Assets Be Accessed After My Death?
Crypto assets are accessed through wallets – for example, computer software, mobile apps, external hard drives or QR codes. They usually have a public and a private key which are needed to access the assets, and the assets cannot be accessed unless you have both of these keys. The public key acts like an account number and this is the key that is used when transactions are received. The private key is an alphanumeric code, or password, that is used to access the assets and make transactions. Crypto users are advised not to share their private key due to security risks.
It can be difficult to access a deceased’s crypto assets as there is no one responsible organisation that can provide access to the assets. For example, when dealing a deceased’s ordinary bank accounts, their executors can provide a Grant of Probate to the bank who can then provide access to the funds in all the deceased’s accounts. It is currently not possible to access crypto assets in this way.
A deceased’s crypto assets can therefore only be accessed if their executor is aware of where the crypto assets are held and how to access them, i.e by having the public and private keys. If the crypto assets cannot be accessed, they cannot be inherited by anybody after your death and their value is essentially lost.
How Can I Ensure That My Executors Can Access My Crypto Assets?
Your executors will need to know what type of crypto assets you own, and they will also need to know your digital keys in order to access your crypto assets following your death. As your Will becomes a public document after your death, your Will itself should not contain your key but you should ensure that this can be found elsewhere by your executors.
There are risks associated with writing down your public and private keys as somebody could find this information and misuse it to access your crypto assets. Therefore, it is important to weigh these risks against the possibility that your executors may not be able to access your crypto assets.
Who Will Inherit My Crypto Assets?
Your crypto assets can be left to a beneficiary in your Will as with any tangible assets or money in a bank account. You should therefore consider who you would like to inherit your crypto assets after your death and make provision in your Will.
It is possible for some types of crypto assets, such as bitcoin, to be nominated within your crypto account so that they pass to a designated beneficiary after your death. However, there could still be disputes if your Will makes contrary provision so you ought to seek some professional advice to ensure that your wishes are carried out.
If you would like any further information, please contact Sophie Wildsmith at s.wildsmith@timms-law.com or on 01283 214 231.
