Crypto market and industry is flourishing at its maximum speed and everyone is getting involved in trading. Let’s learn more about Crypto Inheritance and its impact on Finance.
Digital assets appeared only 15 years ago and will not disappear from our lives. But we, the owners of cryptocurrencies, begin to disappear, sometimes very suddenly and not always for natural reasons. And here a serious problem arises: the inheritance of cryptocurrencies. Of course, there are such potential heirs that it is not a sin to transfer your assets into crypto as much as possible and not give out the keys to anyone. But still, the procedure for inheriting digital assets has been relevant for many years.
In 2018, tragedy struck – businessman Matthew Mellon, who was on the Forbes list, suddenly died in his hotel room in Cancun. His fortune, largely earned through investments in Ripple, was worth nearly $1 billion at the time of his death, including about $200 million in XRP.
Cryptocurrency is traditionally stored in custodial wallets, cold wallets, mobile wallets, and local software storage. The private key provides access to virtual savings, and usually only the owner knows about it. This provides security, but the desire to preserve your capital from potential online robbers can play a cruel joke even on the owner of the coins.
Matthew Mellon’s family had to face succession problems. After the death of the entrepreneur, it turned out that cryptocurrencies were not mentioned in the will, and no one knew the location of the private key. Mellon kept the keys in different places under different names, which created significant difficulties for the heirs.
The heirs spent several months searching for the keys and lost a lot of money, because XRP at that time walked up and down mockingly and giggling. If the capital was stored in stable coins, these guys would not be so nervous, because the USDT-ERC20 price is pegged to the USD. When they finally managed to find access to the wallets, it turned out that Mellon had entered into an agreement with Ripple limiting the volume of sales of XRP. This meant that it was impossible to quickly sell off assets to pay off debts, including taxes.
How to act as a testator?
If you sincerely love your family and do not dream of annoying them posthumously, you need to draw up a will correctly.
Pre-planning
It is recommended to think in advance about who and how to transfer your assets. The will becomes a key document, so it should be drawn up and notarized. This ensures that your savings go to the people you want them to. What happens in cases where there is no will or it is drawn up incorrectly is known to everyone.
Full details in the will
It is assumed that at a minimum you indicate that you have crypto assets and disclose access keys to wallets. Specifying this information in a will reduces the risk of losing assets and makes the inheritance process easier.
Cooperation with a crypto exchange
If your crypto assets are stored on a centralized crypto exchange, notify your future heir about the existence of the account. It is important to provide detailed account login information and indicate that this account contains digital assets.
Regular data updates
It is important to periodically check that passwords and keys are up to date and adjust the will if necessary. Otherwise, your heirs will go through all the circles of hell like the Mallon family.
How to act as an heir?
If crypto assets are stored in a hardware wallet or a device with a software wallet installed, then there will not be any special difficulties. In fact, it is enough for the heir to know about the existence of the wallet and receive the keys to it. This does not have to be disclosed directly; it is enough to indicate the necessary data in the will. So that the heir gets access to the assets only after the will is promulgated and the property is legally registered in accordance with the law.
With centralized crypto exchanges, the procedure for receiving an inheritance becomes more complicated.
Impact of Heir’s Awareness
The points about the heir’s awareness and account login information will be supplemented with several more, namely:
Conclude a trust management agreement: This method is considered one of the simplest inheritance methods. After entering into an inheritance, it will be possible to manage assets on a completely legal basis without the need to transfer them to your account.
Account registration and verification: The heir must necessarily verify his account on the crypto exchange and remove restrictions on transactions with crypto assets. This will make it easier to communicate with exchange support and the inheritance procedure itself will significantly speed up. This is especially important if the will does not provide complete account access information. In this case, the heir will have to contact the exchange support and, while waiting for a solution to the problem, test the GAS to NEO converter out of boredom.
Contacting support: After completing the previous steps, the heir will have to contact the exchange support service and provide documents that confirm his rights to the assets.
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