Unlike traditional savings or investments, crypto currency doesn’t automatically pass to beneficiaries through the probate process. Without reform, millions of pounds’ worth of digital assets could simply be lost forever.
Why crypto is different to other assets
With most financial assets, probate processes are established. Banks, building societies and investment managers all have procedures that allow executors to access accounts and transfer funds to beneficiaries. A financial asset search can be carried out, which contacts hundreds of institutions to identify holdings.
Crypto assets are different. Exchanges and digital wallet providers do not currently facilitate probate in the same way. They rarely allow investors to name direct beneficiaries or appoint solicitors to manage the assets on death.
In addition, crypto currencies are often held under a pseudonym and protected by private keys or lengthy “seed” phrase passwords. If these are lost, there is no way of recovering the assets. This means families can be left with no access, even if they are named in a Will.
Assets held overseas are especially at risk
Many UK investors hold crypto on overseas exchanges. Recovering these assets after death is even more complex, as there are no consistent mechanisms to enable executors to trace or transfer them across jurisdictions.
The result is that large sums are being locked away permanently rather than being inherited by beneficiaries.
Why reform is needed
Crypto ownership is no longer niche – millions of UK households are involved. Yet the probate system has not adapted. As ownership broadens, the absence of proper mechanisms risks depriving families of assets they are legally entitled to.
At TWM, we believe crypto exchanges must be integrated into the standard probate regime, just as pensions, savings and investments are already. Only then will estate administration run smoothly, and the wishes of donors be fully respected.
What investors can do now
Until the law catches up, crypto owners need to take proactive steps to safeguard their digital wealth. This can include:
- Making executors and beneficiaries aware of what crypto assets are held
- Storing seed phrases or private keys securely (for example on an encrypted USB or hardware wallet)
- Using trusted services such as a “dead man’s switch” that releases access details to executors after death
- Seeking professional advice to ensure instructions are included in your Will.
How TWM can help
Our Private Client team works with individuals and families to plan ahead and protect assets, including digital wealth. We can advise on how best to structure Wills, store access details securely, and ensure beneficiaries are not left locked out of valuable holdings.
To discuss your requirements, please contact our Private Client team today for an initial, no-obligation consultation.
