What happens to My Bitcoins when I die?

May 20, 2022

It has been almost impossible to miss the rise of cryptocurrency in our increasingly digital world. For instance, I have watched far too many online videos preceded by adverts encouraging me to trade in cryptocurrencies and even while watching TV, adverts to buy and sell cryptocurrencies are plastered on every available surface. Moreover, cryptocurrencies continuously make headline news, from the volatility of the market to opinion pieces showing the positives and negatives. While some would argue there is the potential for these investments to fizzle out, they have survived thus far and I can imagine these investments regularly forming part of the estate administration process.

Valuing Cryptocurrency Assets for Probate

The obvious question then is, “how do I deal with cryptocurrency assets?” One of the main advantages of cryptocurrency is their security, as the ‘virtual wallet’ can only be accessed by the holder using a secure key. However, what about when another party has a legitimate reason to access your cryptocurrency assets? There is no central register for who owns what or how much, so you cannot simply write to a central registry for this information. In order to understand the issue with this, some explanation of the probate process is needed.

When someone dies probate will be needed if they own certain assets or a certain value of assets, this is determined by the asset holders’ internal rules. If probate is indeed required, then all their assets will need to be valued and reported to HMRC. Therefore, if there is a bank account, you can write to the banks and value this asset. Sounds simple enough, but what if we have cryptocurrency assets? The lack of a central registry means that without having direct access to the virtual wallet, valuing and indeed paying any tax due becomes impossible. Does this mean that should you die while owning cryptocurrency assets it will be forever locked?

Should I include Bitcoin details in my Will?

Careful thought is needed when investing in cryptocurrency. While we cannot predict when we will die, we can prepare for it. We can make arrangements to assist those left behind to properly administer our estates in accordance with our wishes. Simply adding the details of your bitcoin in a Will is not enough nor wise. Wills become public documents once proven so this would invite fraudsters to take advantage.

How can we help?

Should you wish to discuss the options available with dealing with cryptocurrency assets please contact Oliver Wilson at oliver.wilson@herrington-carmichael.com or on 01276 748 370.

> Article: The Importance of keeping Records for Probate

> Article: Pitfalls of DIY Wills

> Will Writing Services

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.

Oliver Wilson

Oliver Wilson

Chartered Legal Executive, Private Wealth and Inheritance

Sign up

Enter your email address for legal updates on Private Client & Family Law.

Please see our privacy policy regarding use of your data.


Latest Articles & Legal Insights

Why should you make a Will?

Why should you make a Will?

When the time arrives, do you know how much difference having a Will in place can make to your loved ones? And yet, most adults in this country have not made a Will.

A Brief Guide to Agricultural Property Relief

A Brief Guide to Agricultural Property Relief

Agricultural Property Relief is a Tax Planning mechanism available to farmers and landowners to make the transfer of farming land on death less financially burdensome.

What is a cross-border Estate?

What is a cross-border Estate?

When an individual dies, their assets and liabilities are calculated as at the date they died, this is known as that individual’s ‘Estate’.

Q&A: Understanding Power of Attorney

Q&A: Understanding Power of Attorney

By having a Lasting Power of Attorney (LPA) in place, it allows you to appoint one or two close friends or relatives to make decisions.

Top Legal Insights

 

Contract Law

Material Breach of Contract

What is a ‘material’ breach of contract by a party to a commercial contract? This is a critical issue regularly considered by the courts. What constitutes a material breach and what are the remedies?

Property Law

Commercial Lease: The Financial impact on Landlord and Tenant

Coronavirus (COVID-19) and the restrictions now in place to control its spread, are having a significant effect on many business sectors.

Divorce and Family Law

Divorce in Lockdown: Can I get some discreet legal advice?

We have spoken to clients who are unfortunately experiencing some family issues, and would like to obtain expert legal advice, yet don’t know how...

Land & Property Dispute

Restrictive Covenants – The Price of Modification

Having identified that your land is burdened by a restrictive covenant and for the purposes of this article the covenant in question will be that only one residential building can be erected on the land. What do you do next?

Wills, Trusts and Probate

Why is having a will so important?

It is entirely up to you if and when you want to create a Will, but it is important to be aware of the consequences of not having a Will.

Award winning legal advice

Herrington Carmichael offers legal advice to UK and International businesses as well as individuals and families. Rated as a ‘Leading Firm 2024’ by the legal directory Legal 500 and listed in The Times ‘Best Law Firms 2023 & 2024’. Herrington Carmichael has offices in London, Farnborough, Reading, and Ascot.

+44 (0)1276 686 222

Email: info@herrington-carmichael.com

Farnborough
Brennan House, Farnborough Aerospace Centre Business Park, Farnborough, GU14 6XR

Reading (Appointment only)
The Abbey, Abbey Gardens, Abbey Street, Reading RG1 3BA

Ascot (Appointment only)
102, Berkshire House, 39-51 High Street, Ascot, Berkshire SL5 7HY

London (Appointment only)
60 St Martins Lane, Covent Garden, London WC2N 4JS

Privacy Policy   |   Legal Notices, T&Cs, Complaints Resolution   |   Cookies  |   Client Feedback   |  Diversity Data

 

 

Our Services

Corporate Lawyers
Commercial Lawyers
Commercial Property Lawyers
Conveyancing Solicitors
Dispute Resolution Lawyers
Divorce & Family Lawyers
Employment Lawyers
Immigration Law Services
Private Wealth & Inheritance Lawyers
Startups & New Business Lawyers

Pay Online >

Please be aware that we have no plans to change our bank details. If you receive any indication that any of our bank details have changed please contact us before sending us any funds. We take no responsibility for monies you transfer into the wrong bank account.

© 2024 Herrington Carmichael LLP. Registered in England and Wales company number OC322293.

Herrington Carmichael LLP is authorised and regulated by the Solicitors Regulation Authority with registration number 446245.