Insights

Estate Planning for Cryptocurrency: Access Is Ownership

By Terry L. (T. L.) Turnipseed, J.D., LL.M., CTFA · November 2, 2026

A bitcoin wallet does not have a customer service line. If the keys die with you, the asset is gone. The plan has to cover the inventory, the access, the fiduciary's legal authority and the tax reporting, and it has to be kept current.

Every other asset in an estate can be recovered by a fiduciary with the right paperwork. A bank honors letters of administration. A brokerage transfers the account. A title company records the deed. Cryptocurrency held in a self custodied wallet is different. There is no institution to call, no password reset and no court order that unlocks it. Whoever holds the private key controls the asset, and if nobody holds it, the asset is gone. Industry estimates suggest that a substantial share of all bitcoin ever mined is already permanently inaccessible, much of it because of lost keys.¹

That changes the planning question. For most assets the question is who gets it. For digital assets the first question is whether anyone will be able to get it at all.

Inventory

Start with a complete list: each coin or token, where it is held, whether it is on an exchange or in a self custodied wallet, the type of wallet, and roughly how much. Exchange accounts are closer to brokerage accounts and can usually be reached by a fiduciary with the proper documents, though each exchange has its own process. Self custodied wallets, hardware devices and multisignature arrangements each need their own instructions. The inventory should also cover NFTs, staked assets, DeFi positions and anything else that would be invisible to an executor reading a bank statement.

Access, kept out of the Will

The Will is a public document once it is admitted to probate. Private keys and seed phrases do not belong in it, and they do not belong in the trust either. They belong in a separate, secure place, such as a safe deposit box, a hardware device stored with the attorney or a reputable digital vault, with the Will or a letter of instruction telling the fiduciary where to look and how to decrypt it. Some families split the seed phrase among trusted people so that no one person can act alone. A multisignature wallet that requires, say, two of three keys lets a spouse, a child and a professional fiduciary share control without any of them having it individually.

Whatever the method, test it. An executor who has never used a hardware wallet should not learn in the week after the funeral.

Legal authority for the fiduciary

Access without authority is theft, and authority without access is useless. Nearly every state has adopted a version of the Revised Uniform Fiduciary Access to Digital Assets Act, which gives executors, trustees and agents under a power of attorney the right to deal with digital assets and sets the rules for online accounts.² The documents should grant that authority expressly, and the power of attorney should do so as well so that an agent can manage the assets during incapacity. A trust is often the better holding vehicle: it avoids probate, keeps the holdings private and lets a trustee with technical competence manage the assets for beneficiaries who have none.

Tax

The IRS treats cryptocurrency as property, not currency.³ At death the assets are included in the gross estate at fair market value, and they receive a stepped up basis, which can eliminate years of unrealized gain.⁴ Valuation on the date of death has to be documented, which means capturing exchange prices at the relevant time for each asset. Brokers now report digital asset sales to the IRS on Form 1099-DA, beginning with transactions in 2025, and basis reporting follows for 2026.⁵ The reporting reaches exchanges, not self custodied wallets, so a fiduciary will need the decedent's own records to compute gain on anything sold after death.

Keeping the plan current

Crypto holdings change faster than estates. New wallets are opened, exchanges fail, hardware is replaced, and values move by half in a year. The inventory and the access instructions should be reviewed at least annually and whenever the holdings change materially. The estate plan itself should be reviewed whenever a meaningful amount moves into or out of digital assets.

The underlying point is simple and easy to overlook. With every other asset, the law provides a path for the people you leave behind. With cryptocurrency, you are the only one who can build it.

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