NewsAs digital assets become a more common part of family wealth, estate planning is getting more complex and the stakes are higher than many realize.
In a recent CoinDesk article, Trusts & Estates partner Azriel Baer shared insights on how easily crypto assets can be lost without proper planning, from missing private keys to delays in probate and fiduciaries unfamiliar with digital assets.
From the article:
While leaving property or mutual funds behind in a will is a pretty cut-and-dry process, without proper planning, inherited crypto can easily be lost to probate delays, missing private keys or fiduciaries unfamiliar with the asset class, said Azriel Baer, a partner in the estate planning group at New York law firm Farrell Fritz.
Baer, who has worked on an estate where tens of millions of dollars in crypto were lost to the heirs due to poor planning, said one simple point to remember is making sure an appropriate person is named to deal with this type of asset. Someone who has the knowledge to deal with things like social media accounts, online transactions and blockchain-based assets.
“An uncle or cousin, who is an organized person, might know the family in a trusted capacity and understand its dynamics, but when he’s told to figure out how to get a bitcoin off a wallet, could be floundering,” Baer said in an interview. “So think about naming somebody who has some expertise in the digital asset world to deal with the asset when you’re not around.”
One problem is there’s a tendency among some people holding digital assets to eschew any form of hard copy in favor of storing information about accounts digitally in emails or in drives. This is fine as long as it doesn’t turn into “a detective story,” Baer said, alluding to the fact that finding these could be made even tougher by searching for passwords and through endless emails.
“I always advise clients to have a list of important accounts and information, and either tell your kids about it, or keep it in the safe deposit box. Too many times we encounter people trying to comb through filing cabinets or computer files and being at a loss,” he said.
Read the full article on CoinDesk here: Crypto wealth: Millions in crypto wealth at risk of vanishing when holders die. Here’s how to protect it
