Millions of Crypto Assets at Risk of Loss: The Complete Guide to Digital Inheritance Planning

When it comes to digital inheritance, millions of dollars are no longer just hypothetical figures. With millions of crypto holders around the world, the risk of permanently losing digital assets becomes more real when owners pass away without proper planning.

The issue is simple but serious: without the right inheritance strategy, crypto investments worth millions of rupiah or even millions of dollars can disappear forever. This is not just a technical problem but also a complex legal, administrative, and emotional challenge for the families left behind.

Scale of the Issue: Why Jutaan Figures Need to Be Considered

Currently, more than 50 million adults in the United States hold crypto in their portfolios. When calculated globally, this number is much higher. This means that most families, wherever you are, will likely face questions about how to handle digital assets when a family member passes away.

“For years, we’ve heard doubts from advisors about whether digital assets are part of the family estate,” said Christopher Nekvinda, Director of Global Learning Operations at Cannon Financial Institute, an educational organization based in Athens, Georgia, specializing in wealth management.

The fundamental difference between traditional inheritance and crypto inheritance lies in its complexity. Physical property, mutual funds, or stocks can be easily transferred according to instructions in a will. But crypto? These digital assets are controlled by code locked in a long string of numbers and letters called a private key. Without access to this key, no one can touch the assets, not even heirs.

Understanding Crypto Storage and Access Challenges

The first step in planning a crypto inheritance is understanding how the assets are stored and who has control over them. Does the crypto holder store assets on exchanges like Coinbase, on specialized custody platforms like BitGo or Fireblocks, or in hardware wallets like Trezor?

Each choice has different legal and practical implications. If crypto is stored on a centralized exchange or custodian, the transfer process may be simpler because the institution has documented access systems. However, if the crypto holder prefers to keep private keys offline—either on hardware devices or even printed on paper—the process becomes much more complicated.

“Regulatory updates in the United States under the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) provide much-needed clarity,” explains Nekvinda. “This law ensures that an executor or trustee can legally access a deceased person’s digital assets in the same way as traditional securities.”

However, this legal clarity does not automatically solve practical issues. Custodians still require proper documentation and clear identification of who is authorized to access the assets. Without preparation, this process can be delayed for months.

Real-Life Story: When Jutaan Figures Are Lost Due to Poor Planning

Azriel Baer, a partner in the estate planning group at Farrell Fritz law firm in New York, has handled cases where tens of millions of dollars in crypto were lost by heirs. The cause is simple: poor planning and no one understanding digital assets to manage them.

“When someone appoints an uncle or cousin as executor, they often choose someone organized and trusted by the family,” Baer said. “But that person might have no idea how to access Bitcoin from a digital wallet. Suddenly, they are faced with a task far beyond their capabilities.”

One of the biggest challenges is the trend among crypto holders to avoid any physical copies and store all information digitally—in emails, cloud storage, or specialized apps. This creates what Baer calls a “detective story”: heirs must sift through layers of digital information, search for lost passwords, trace emails from years ago, and hope to find clues about where the assets are actually stored.

“I always advise clients to make a complete list of all accounts and important information, then inform family members or keep it in a safe,” he said. “Too often, we see people ending up confused because they have to dig through unorganized computer files or physical archives.”

Legal Strategies to Protect Digital Wealth in the Jutaan Range

What if the crypto holder has not made a will? That’s where the problem becomes even more complex. The legal process called probate—where a court appoints an administrator to distribute a deceased person’s estate—can take six to ten months. During this period, no one has legal control over the assets, which can be a serious issue for highly volatile crypto like Bitcoin (BTC), currently valued around $78.31K.

To address this, Baer recommends using a trust as a planning tool. “By creating a trust and designating it as a transfer on death or current owner, the trustee can access the assets directly after someone passes,” he explained. “This is much faster than waiting for the court to get involved and authorize a fiduciary.”

An alternative strategy is forming a Limited Liability Company (LLC) as a container to hold crypto. The advantage is that an LLC can be easily transferred to a trust without moving the crypto assets themselves. “This differs from storing in a cold wallet and wanting to transfer it to a trust,” Baer said. “With an LLC, you only need to transfer the company structure, while the digital assets remain secure inside.”

One important warning: never place the actual private key in your will, because in most jurisdictions, a will becomes a public record once filed with the court. Unscrupulous individuals could use this information to access your assets illegally.

Practical Steps to Take Today

To protect crypto investments worth millions from being lost forever, take the following actions:

1. Create a Complete Inventory
List all your crypto accounts, platforms where assets are stored, and how to access them. Use a secure password manager or store this information in a physical safe.

2. Choose the Right Executor
Ensure the person you appoint as executor understands digital assets, or give them access to a consultant who can help. Do not delegate this responsibility to someone who has no understanding of technology.

3. Document Your Intentions
Explain in detail whether you want digital assets liquidated or managed for heirs. This will help prevent confusion and disputes later.

4. Use Appropriate Planning Tools
Consider using a trust, LLC, or a combination of both based on your specific situation. Consult with an experienced estate planning attorney in digital assets.

5. Update Your Plan Regularly
The crypto world is constantly evolving, as are regulations. Review and update your estate plan at least annually or when significant changes in your asset holdings occur.

By taking these steps today, you can ensure that your valuable crypto investments—whether a few million or tens of millions of dollars—reach your heirs safely and efficiently, rather than disappearing into administrative darkness or unnecessary technical confusion.