What happens to your cryptocurrency after you die?
Cryptocurrency is a digital currency that uses cryptography for security. It’s generally difficult to counterfeit, or steal, because of this crypto tech. But it also makes whatever digital currency you’ve earned nearly impossible to pass on. While no one knows how long bitcoin will last (some sceptics wouldn’t put it past 5 years), if it remains intact then it’s likely to outlast you. Here’s a look at what happens to your cryptocurrency once you die.
Who can access your cryptocurrency?
One of the largest advantages of a crypto wallet while you’re still alive is that no one can get into it. This isn’t so great once you’re dead.
To get into a crypto account, you’ll need a private key. A private key is an unchangeable password, which is generated when you create a new cryptocurrency wallet. Each wallet uses a string of random characters called a public key visible to anyone, as an address for sending and receiving the cryptocurrency. A separate private key allows the owner access to the wallet’s contents.
So, the process should be simple after you die – just make sure that someone gets a copy of the private key. In practice it’s simple, but it isn’t always safe or viable.
Can you name beneficiaries to your cryptocurrency?
We’ve all scribbled a quick note outlining that we’d like to leave 50 quid to that distant second cousin once removed who lives on the Orkney Islands. Bequeathing your crypto empire to your loved ones, though, isn’t so simple.
Most cryptocurrency exchanges don’t allow you to name a contact or person who should be able to keep in contact with the crypto bank once you die. Coinbase, the largest trading platform, for example, won’t flag any unclaimed assets, and it’s up to the family to come forward.
Can you put cryptocurrency in your will?
One of the solutions to making sure your hoards of Bitcoin isn’t lost forever might be to outline the details of what you’ve got stored on the blockchain in your will and, at the very least, letting your family know you’ve got crypto stashed away.
But not so fast, crypto-enthusiasts. Wills aren’t designed to hold private information, and are technically public documents. While a will won’t enter public records immediately, it’s unwise to risk exposing the keys to your crypto wallets at all.
How to give your crypto wallet password to someone else after you die?
While it isn’t advised to put your crypto password in your will proper, you could create a secure trust to house it in. We’ve written about how to create a trust in your will here.
If you’re still feeling a bit itchy about that idea, you could cut up your password and put it in separate trusts, numbering the parts. Though, make sure each person knows about this plan to stop it from getting too complicated.
Can you just show the person’s death certificate?
The Coinbase exchange, the exchange that already allows you to name a beneficiary, also allows access to someone’s crypto wallet provided you produce a death certificate, and the crypto holder’s will has outlined the details of the coin stash in their will.
What’s the future of cryptocurrency and death?
Overall, industry experts say that between 2.3 million and 3.7 million bitcoins have been lost. While this is for a variety of reasons, a big chunk of that lost bitcoin is from it simply disappearing with those who’ve died. At current prices, that’s worth between $15 billion to $24 billion.
Find out more
Dying isn’t all about arranging a funeral and filling in countless forms. There’s also your digital death. That’s why we’ve created our Digital Death page. Take a look here.
What are your data privacy rights after you die?
