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How Do You Include Crypto or NFTs in a Will?

Cryptocurrency and NFTs (non-fungible tokens) require additional steps to be passed on in a will that typically aren’t needed for traditional assets like bank accounts and real estate. Unlike money or land, virtual currency and digital tokens aren’t tangible and can only be accessed through a personal key and other login information. If no one knows the necessary information to access the assets after you pass away, they are basically useless to your heirs and beneficiaries.

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Luckily, you can take a few simple estate planning steps to ensure your executor and beneficiaries can locate, access, and use your crypto and NFTs after you pass away. Keep reading to learn how to include these unique assets in your last will and testament.

Why Should You Include Cryptocurrency and NFTs in Your Will?

Planning for your cryptocurrency and NFT assets in your will makes the probate process more efficient. It helps to ensure that these digital assets are distributed to your loved ones according to your wishes after your death.

The Internal Revenue Service (IRS) defines both cryptocurrencies and NFTs as digital assets and treats them as personal property for estate planning and tax purposes. Like most other personal property in your estate at the time of your death, cryptocurrency and NFTs must go through probate before they can be distributed to your beneficiaries. Probate is the legal process of settling and distributing your estate after your death. If you don’t develop and outline a specific plan for distributing your crypto assets and NFTs in your will, the probate court may have the final say over what happens to these assets.

Step One: Reference Your Cryptocurrency and NFTs in Your Will

To successfully pass on cryptocurrency and NFTs to your chosen beneficiaries, your will should specifically reference the crypto assets and NFTs that you want to pass on. Assets that you don’t account for in your will fall into your “residuary estate.” These leftover assets go to the beneficiaries of your residuary estate. For physical assets like jewelry and cars, which are easily discoverable as assets after your death, this isn’t a problem. For digital assets like crypto and NFTs, which exist in the intangible realms of digital wallets, online exchanges, metaverses, and the Ethereum blockchain, your heirs will likely never discover them if you don’t tell them they exist.

While you should mention your crypto and NFTs in your will so they don’t fall into your residuary estate, you should not list the personal keys, passwords, usernames, and PINs needed to access them. When your will goes through probate, it becomes a public record. If you list your access information in your will directly, people can hack into your online accounts and take your digital assets.

Since your beneficiaries must also know how to access your crypto and NFTs to inherit them after your death, you’re probably wondering how to give them this information without risking the security of your digital assets. That’s where creating a separate memorandum with the information required to access your digital assets comes into play.

Step Two: Create a Crypto and NFT Access Guide

To maximize security, you should create a separate memorandum with a list of your digital assets, where to locate them, and how to access them. Unlike your will, this separate document does not become a public record, so you can ensure that only your heirs and fiduciaries (not unknown hackers) can access your cryptocurrency and NFTs when you pass away.

Your crypto and NFT access guide is your digital legacy. It should include as much information as necessary for your beneficiaries to easily find, access, and use their newly inherited crypto or NFTs. While the specifics of your access guide will depend on the number and types of crypto or NFTs that you own, it should include the following basic information:

  • An inventory of your crypto and NFTs: There are several forms of digital currency (crypto) and digital tokens (NFTs). Examples of digital currency include Bitcoin, Ethereum, and Binance Coin. Digital tokens often take the form of virtual collectibles such as digital art or other digital files. Make a list of the crypto and NFTs that you own, including the types, number of shares, and the fair market value at the time you purchased them. This list helps your executor and beneficiaries identify the specific crypto assets and NFTs in your estate at the time of your death.
  • The digital wallets you use: Once your executor and beneficiaries know about your crypto and NFTs, they must also know where to locate them. Many NFT and crypto-holders store their assets in digital wallets. You should provide information about your digital wallets, how to find them (your smartphone, laptop, USB drive, etc.), and which assets are stored in them.
  • The crypto exchanges and NFT marketplaces you use: Cryptocurrency exchanges like Coinbase, Gemini, and Robinhood allow you to buy, sell, and manage your cryptocurrencies. Likewise, people use NFT marketplaces like OpenSea and Rarible to exchange NFTs. List any online exchanges and crypto accounts you use to manage your digital assets so your executor and beneficiaries can access them after your death.
  • Private keys, passwords, usernames, and PINs: Include the information that your executor and beneficiaries must have to access your crypto and NFTs, digital wallets, and online exchange accounts. This information is essential for your beneficiaries to inherit your digital assets as you intended. Be sure to provide up-to-date information and instructions on how to access each particular asset.

Step Three: Tell Your Executor Where To Find Your Access Guide

Your “executor” or “personal representative” is the person you appoint in your will to oversee the distribution of your estate after you pass away. To transfer your crypto and NFTs to the beneficiaries named in your will, your executor must have all the necessary information outlined in your crypto and NFT access guide. So, whether you store your access guide with your will or in another location, make sure your executor knows where to look for it after your death.

Need Help Including Crypto or NFTs in Your Will?

Whether you’ve acquired a rare Cryptokitty, digital artwork, or simply dabble in blockchain-based assets, you must have the right estate planning documents in place to ensure your digital assets go to the loved ones you choose when you pass away.

If you have a simple digital estate you’d like to pass on, you can use FindLaw’s DIY Last Will and Testament Form to include the crypto or NFTs you want your beneficiaries to receive when you die. For larger, more comprehensive crypto and NFT holders, speak with an estate planning attorney that’s knowledgeable in blockchain technology to help you with the process.

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Written by:

A. Hollyn Scott, Esq.

Contributing Author

Reviewed by:

Catherine Hodder, Esq.

Senior Legal Writer