Crypto that nobody can find, or nobody can unlock, is lost for good. A little planning keeps it from disappearing with you.
What to know
- Without a plan, heirs may not know crypto exists, and self-custodied coins can’t be recovered without the keys.
- Keep an inventory of accounts and wallets, separate from the secrets that unlock them.
- Never put seed phrases or passwords in a will, which can become a public record.
- Inherited crypto generally gets a stepped-up cost basis to its value at death.
Stories of fortunes locked away forever after an owner died without sharing keys have made the point well: crypto doesn’t come with a probate-friendly paper trail. If you hold any, a basic plan protects the people who’ll have to sort things out.
The core problem
Your heirs need to know three things: what you have, where it is, and how to access it. With a bank account, a statement in the mail covers the first two, and the bank handles the third. With crypto, especially self-custody, you have to supply all three, without making it easy for anyone to steal it while you’re alive.
A practical plan
- Make an inventory. List each exchange account, each wallet and what’s in it, roughly. Update it now and then.
- Write a letter of instruction explaining how each holding works and what your executor should do, in plain language.
- Store access information securely and separately. Seed phrases and hardware wallet PINs can go in a safe or safe deposit box your executor can reach, or be split using a method your estate planner recommends.
- Tell someone it exists. Your executor or a trusted person should know there’s an inventory and where to find it.
- Make your will or trust cover digital assets, and name an executor or trustee who’s comfortable dealing with them, or authorize them to hire help.
Red flag
Don’t write seed phrases or passwords into your will. Wills often become public records during probate, and anyone who reads the phrase can take the funds.
Exchanges vs. self-custody
| Exchange account | Self-custody wallet | |
|---|---|---|
| Heirs need | Account details and estate documents | The seed phrase or device plus PIN |
| If information is lost | Exchange can usually still release funds to the estate | Funds are effectively gone |
Taxes for heirs
Inherited crypto, like other inherited property, generally receives a stepped-up cost basis equal to its fair market value on the date of death, which can reduce capital gains tax when heirs sell. Large estates may also face estate tax. See how crypto is taxed and talk to a professional for your situation.
Whatever you do, keep your keys safe while you’re alive; our guide to wallets and custody covers the basics.
Common questions
Can an exchange release my account to my heirs?
Most major exchanges have a process for executors, usually requiring a death certificate and proof of authority such as letters testamentary. Ask your exchange how it works.
Can I name a beneficiary on a crypto account?
Some platforms allow it, but many don’t. A will or a trust is often how crypto passes, so talk to an estate planning attorney in your state.
What’s a revocable living trust?
A trust you control while alive that can hold assets, including crypto, and pass them to beneficiaries without going through probate. Setting one up correctly takes professional help.
This guide explains how crypto and the related rules work for readers in the U.S. It is not investment, tax or legal advice, and it doesn’t recommend buying or selling any asset. Crypto prices are highly volatile, and laws and agency guidance change; check current official sources and consider professional advice.