The growing popularity of owning some form of cryptocurrency means that these issues must be considered when planning for your own estate. If you currently own any cryptocurrency, providing instructions for what will happen to it in your will is necessary.
Cryptocurrency is a board term that refers to any form of virtual money that only exists in digital form. There are many different types of crypto currencies although many people are most familiar with the most popular version known as Bitcoin. The only way to access these funds is using a personal passcode through a computer. Since there is no physical record of the currency, unlike a bank account, it is essential that any cryptocurrency must be specifically named in your will.
Furthermore, the person who will be administering your estate should know about the existence of cryptocurrency. If the fiduciary has your passcode, he or she can easily take control of the currency which, is why it is so important to select and install a fiduciary who can be trusted with this information. The passcode is the most important piece of information used to access any crypto assets, so it should only be given to a person you have a high level of trust in.
It is not a good idea to list your passcode directly in any estate planning documents because these could become a matter of public record if your estate goes through probate. It is far better to list the cryptocurrency as an asset within your will and provide the specific instructions about how to access it only in a separate document that will be accessible to the person who administers your estate.
This separate document can be generally referenced in the will. It is important to ensure that the personal passcode is stored in a safe location because it might not be possible to recover any cryptocurrency without it.
Cryptocurrency is just one example of digital assets that should be included in your estate plan. Schedule a consultation with a Pasadena estate planning lawyer to learn more.