We explain, in plain English, how including crypto as part of an estate plan can protect family members from avoidable stress and lost value.
FCA research shows roughly 10% of people in the United Kingdom hold some form of cryptocurrency, and ownership rose sharply between 2021 and 2022. That makes it more likely digital assets form part of someone’s estate.
We set expectations early: crypto is not held like bank money, so planning must cover both access and who inherits. We outline the difference between the legal document and the practical instructions executors need.
We show how to keep security tight while making the process workable for less tech-confident loved ones. Expect clear steps: a sensible will clause, a crypto inventory, the right executors, and a secure access plan.
For practical guidance and a model approach, see our linked guidance on leaving digital assets here. We offer straightforward advice to preserve wealth and protect heirs.
Key Takeaways
- Make a clear legal clause and a separate, secure access plan.
- Create an up-to-date digital inventory of all assets and wallets.
- Authorise trusted executors and provide practical retrieval steps.
- Keep private keys out of the will; use a confidential letter instead.
- Review plans regularly to reflect tax and probate realities.
Why crypto needs specific estate planning in the UK
A digital wallet without the right access details can turn a valuable holding into an unusable record on the blockchain. That risk makes standard wills alone unsuitable for many digital assets.
Loss of private keys can lock funds forever
Decentralised systems offer no central help. If the private key or seed phrase is lost, tokens remain at their address but are unreachable.
Wills are public after probate, so privacy matters
Wills become public documents at probate. Never place passwords or seed phrases in a will. That exposes sensitive details and weakens security.
More people now hold digital assets, so plan for access
With ownership rising across the UK, more estates include digital holdings. We advise steps that make sure executors can gain lawful access without publishing secrets.
| Feature | Bank account | Decentralised wallet |
|---|---|---|
| Third-party recovery | Often available | Not available |
| Where instructions should sit | Will or bank forms | Will avoids secrets; use secure letter |
| Key risk | Paperwork delays | Lost keys = permanent loss |
- Record what exists, but keep secure access details separate.
- Choose executors who can follow technical steps after death.
- We help balance privacy and practical retrieval for families.
How cryptocurrency is treated under UK law and probate
The law is catching up: courts increasingly treat digital tokens as property for estate purposes.
What this means for families
For practical purposes, most wills are written to cover the whole estate. Digital assets can be swept up as part of that estate, so they do not need a separate document to be valid.
Legal recognition and where it stands
The 2019 UK Jurisdiction Taskforce said common law can recognise such items as property. In June 2023 the Law Commission proposed new rules and a possible third category of thing to reflect their unique nature.
Probate and the duties of executors
Probate is the process that lets executors collect, value and distribute assets. Executors must know what exists, where it sits and who should receive it.
Plan clearly. Legal recognition helps, but access still depends on records and safe operational instructions. Tax reporting and valuations form part estate administration from day one.
| Aspect | Legal status | Probate impact |
|---|---|---|
| Recognition | Common law treats as property | Can be included in estate list |
| Access | Separate practical steps needed | Executors require clear records |
| Valuation | Subject to tax reporting | Must be valued at date of death |
including cryptocurrency in your will uk with the right structure
Estate language matters. Use broad phrasing so digital holdings pass as part of the general estate rather than as a narrow list that can fail.
Using a broad “estate” gift versus a specific legacy
Broad gift – keeps tokens, exchange accounts and wallets covered even if you trade or move assets.
Specific legacy – names particular tokens or addresses. This can fail if holdings change before death.
Avoiding gifts that fail when arrangements change
Practical tip: do not name individual wallet addresses or token types as the sole identifier for a gift.
Authorising executors to act
Draft a clause that allows executors to access, manage, transfer or sell crypto assets during administration.
Linking to a separate operational document
Keep sensitive instructions outside the will. Use a linked Letter of Wishes or secure document for step-by-step operational instructions.
| Approach | Flexibility | Risk | Best use |
|---|---|---|---|
| Broad estate gift | High | Low | Most cases |
| Specific legacy | Low | High if assets change | When exact asset must pass |
| Will clause + Letter | High | Low | Privacy + practical steps |
| Executor powers | Essential | N/A | Admin and disposal |
For model clauses and a practical form of a separate document, see our guidance at how to include cryptocurrency and NFTs.
Build a crypto and digital assets inventory your executors can use
Recording what you own and where it sits gives executors the map they need to act quickly. We recommend a simple inventory that spells out each holding and the steps needed to reach it.
What to list for each holding
For every asset note the type, platform, wallet and an approximate value at the date of death. Add the account name, email used and any relevant transaction IDs.
Where the asset “lives”
State whether the asset sits on an exchange, a hosted account, a hot wallet on a phone, cold storage or a hardware device kept at home.
Record access dependencies and keys
List all dependencies: email, mobile number, authenticator apps and SIM details. Note where 2FA backup codes and recovery phrases are stored, but never place actual keys in a will. Use a secure letter or sealed record for those items.
Source-of-funds and value
Capture simple notes on how the funds were acquired and keep basic transaction history to help with tax and reporting. A clear source record speeds dealings with institutions and HMRC.
Keeping the inventory current
Make a routine to update the list whenever you open an account, move funds or change devices. Store the inventory where executors can find it and state the last update date so figures are reliable.
| Field | Why it matters | Example |
|---|---|---|
| Asset type | Identifies what to value | Token, NFT, stablecoin |
| Platform / account | Shows where to log in | Exchange name or app |
| Wallet / device | Shows storage method | Hot wallet; Ledger device |
| Access notes | Highlights 2FA and recovery needs | Authenticator app on phone |
| Approx value & date | Helps valuation at death | £3,200 (date) |
Choose executors and specialist support for crypto assets
An executor’s role changes when wallets and exchanges are part of the estate. Executors must gather details, report values to HMRC for Inheritance Tax and distribute assets under the will.
Why executors may need hands-on knowledge
Many trusted family members know the basics, but lack confidence with wallets, 2FA and device recovery. That gap can slow administration and risk loss of wealth.
Consider a digital executor and split duties
A digital executor handles technical tasks while others manage probate and correspondence. This split keeps work practical and reduces stress for people who are less technical.
- Identify an executor who can follow step-by-step access notes.
- List professional advice contacts such as solicitors and accountants.
- Note when a regulated, third-party custodian might suit for smoother access and added security.
We recommend naming an expert adviser in a Letter of Wishes and linking to further guidance on tax and access at crypto inheritance tax guidance.
Create a secure access plan without putting private keys in the will
Keep sensitive access details out of public documents to protect assets and privacy. A will becomes public after probate, so never place seed phrases, passwords or PINs inside it.
What not to put in legal papers
Do not record private keys, a private key phrase, passwords or device PINs where anyone can read them. Treat those items as secrets.
Use a Letter of Wishes for practical steps
A private letter lets you give step-by-step instructions to executors without exposing details. We recommend a short letter wishes document that points to a secure record rather than listing credentials.
Safe storage choices
- Sealed envelope stored with a solicitor or executor.
- Home safe or bank deposit box for physical backup.
- Solicitor storage or a regulated custodian for added oversight.
Explain wallet types and access routes
Describe whether a wallet is hosted (third party holds keys), hot (online app), cold (offline paper) or a hardware device. Simple labels help executors find the right device fast.
“Make access controlled, not public — that gives families peace of mind.”
Write a Letter of Wishes that actually works in practice
A short, clear Letter of Wishes saves stress and gives executors a practical path to follow.
What the document should open with: a dated list of holdings and a short note on how they are held. State whether an asset is on an exchange, a hosted service or a hardware device.
Step-by-step instructions for accessing each wallet or account
For every account give a simple ordered list that an executor can follow.
- Name the platform and where to find the device or paper note.
- List the first action: log into the email, then attempt password reset if needed.
- Note the next action: locate authenticator app or backup codes, and the order to try recovery routes.
Handling device access and recovery: phones, email accounts, backup codes, SIMs
Make clear who holds phone access and whether a SIM swap may be needed. Note the email provider and any recovery options.
Include exact details on where backup codes are stored and whether an authenticator app is on a device or on paper.
Transfer instructions aligned to your wishes
State whether assets should pass straight to beneficiaries, be sold for cash, or be consolidated to a single account first.
Be specific: name beneficiaries, give percentage splits or a simple sale instruction. That form keeps executors focused and reduces disputes.
Reviewing and updating the letter regularly with minimal formality
Keep versioning simple: title each update with a date and a short note of changes. A review every 12 months is usually enough.
We advise a stress‑test. Ask someone unfamiliar with crypto to follow the steps. If they can, you have a workable letter.
- Tip: store the letter with a solicitor or sealed with the will executor.
- See broader guidance on what counts as a digital asset at what counts as a digital asset.
Tax, valuation, and administration: what happens after death
Executors often face a rush of tasks after someone dies; sorting digital holdings is one of the most time‑sensitive.
We secure the estate, identify each crypto holding and then value it for tax purposes. Estates must report to HMRC for Inheritance Tax. That means a clear date and a reliable price source are essential.
Valuing assets at the date of death
Value at the date of death is the figure HMRC expects. Use a timestamped exchange price or an agreed market quote. Note the exchange, the exact date and the method used to set the value.
Preparing executors for volatility and timing
Markets can swing quickly. Executors should follow a simple plan: secure access, record prices, then choose whether to sell or hold.
Decisions about timing should be documented so beneficiaries understand the reasoning if values move before distribution.
Record‑keeping and evidence for platforms
Exchanges often ask for ID, death certificate and proof of authority. Keep copies of transaction IDs, wallet addresses and any correspondence with platforms.
| Item | Why it matters | Example |
|---|---|---|
| Timestamped price | Supports valuation | Exchange rate at 23:59 on date |
| Proof of ownership | Reduces disputes | Transaction history or account emails |
| Authority documents | Needed by platforms | Grant of probate; executor ID |
Reducing disputes with clear records
Good documentation makes intentions plain. An inventory, a Letter of Wishes and a strong estate clause that match each other limit disagreement.
Conclusion
A practical plan makes sure heirs can find and use digital property when needed.
We say this plainly: digital units can be part of an estate like any other property, but they need extra planning for access. A clear will, strong executor powers, a kept inventory and a secure Letter of Wishes form the right structure.
Keep private access details out of public papers. Store recovery phrases and passwords safely and tell executors where to look. That simple rule protects privacy and preserves value for beneficiaries.
Good estate planning reduces delays, tax headaches and family disputes. Review what you hold, where it sits and whether the plan would work tomorrow. Seek tailored advice if holdings are substantial or spread across many wallets or jurisdictions.