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04:23 AMKey considerations when planning for your legal needs.
The cryptocurrency stays on the blockchain, but it can only be moved by whoever holds the private keys or seed phrase. There is no customer-service line to reset a password and no automatic transfer to an estate. If no one else can reach the keys, the holdings can become permanently inaccessible. A plan that records where access is kept — without exposing the keys themselves — and that grants a fiduciary lawful authority is what makes recovery possible.
Yes. A will can direct who inherits your cryptocurrency and how it is divided. What a will should never contain is the private key or seed phrase itself, because a will becomes part of the public probate record. The will names a fiduciary's authority over digital assets and points to where access is securely held; a separate, private instruction holds the access details.
A digital executor is the person responsible for your digital property — accounts, files, and cryptocurrency — after death, and choosing someone with the capability to handle crypto matters. Authority is the harder part. In New York, a fiduciary's access to digital assets is governed by statute (EPTL Article 13-A), and a provider is not required to honor a request the governing documents do not support. Naming that authority in the will, trust, and power of attorney is what gives an executor a path a custodian must recognize.
No. Keys and seed phrases should never be written into a will or any document that could become public or be shared during administration. Store them offline — a hardware wallet, a metal backup, a sealed envelope held with counsel, or a multi-signature arrangement — and have your documents reference the location, not the secret. The plan points to the credentials; it never becomes them.
Yes, and a trust often fits digital assets well, because it keeps the disposition private and lets a trustee manage the holdings across a transition. Two points matter in drafting: a trustee is ordinarily bound by the prudent investor rule, which does not sit easily with a concentrated, volatile asset, so the trust should expressly permit holding cryptocurrency; and the transfer into the trust should be documented, including the trustee's acceptance of the assets.
Cryptocurrency is treated as property for tax purposes, so its value in an estate is its fair market value on the date of death, drawn from exchange data. That date-of-death value also becomes the heir's new cost basis — the step-up that can reduce capital-gains tax on growth during the owner's life. New York imposes its own estate tax with a separate exemption, and a volatile asset can complicate both valuation and planning. These are questions for counsel and a tax adviser working from the actual figures.
It is the New York statute that governs how a fiduciary may reach a person's digital assets. New York adopted the Revised Uniform Fiduciary Access to Digital Assets Act as Article 13-A of the Estates, Powers and Trusts Law. It sets an order of priority — a provider's online tool first, then the will, trust, or power of attorney, then the terms of service — and distinguishes the record that a communication existed from its actual content, which takes a higher level of consent to reach.