Digital inheritance is something all of us with a digital footprint should think about. Yet it remains something few of us consider as we amass years’ worth of digital content to our names. The issue becomes more pressing when it comes to NFTs and crypto because of the economic value attached to these digital assets, so it is important to have a contingency plan in place should you or a loved one pass away.
Below, we address some key things to consider around digital inheritance and some ways to preserve and retain access to your digital legacy.
What is a digital legacy?
A digital legacy is the digital information left by someone when they pass away. This can take the form of files, images, emails, social media accounts, blogs, cryptocurrency, and NFTs. Historically, we would keep photographs, books, and letters from loved ones, but in an age where we are living increasingly online, digital assets are helping to provide those grieving sentimental value more than ever before.
What is digital inheritance?
Digital inheritance is the passing down of digital assets to a beneficiary as a result of someone’s death. Digital assets, NFTs, and cryptocurrency can now form part of a person’s estate and can be passed down in the event of their death. Like other asset classes, these digital assets and their beneficiary can be named in a person’s will. It is important to leave instructions on how these digital assets can be accessed: for example, leaving private keys with a trusted source.
How can I ensure my NFTs and cryptocurrency are accessible after my death?
The web3 sphere faces challenges with digital inheritance due to the problem of security versus accessibility. Despite this, there are steps you can take to ensure your loved ones can gain access to your digital assets when you pass away.
Note: these are suggestions but cannot guarantee the safety of your assets. Please seek help from a legal professional for advice on protecting your digital assets.
Update your will to include digital assets
Detail what digital assets you hold, who will inherit them, and how these will be managed posthumously. You will also need to leave instructions on how to access these assets. Be aware these instructions may be read by a non-crypto native, so leave as much detailed information as possible.
Leave your private keys in a bank vault or safety deposit box
You need to give your beneficiary access to your private key without compromising your security; writing it down and using a safety deposit box can facilitate this. Of course, it’s possible to leave the private keys with them while you’re alive, but there is always the risk of it getting lost or someone else getting their hands on it.
Consider getting a cold wallet
If you can, store the bulk of your crypto on a cold storage wallet. It gives you the option to leave your private keys with your beneficiary while you’re alive without giving them immediate access to the physical wallet. This may not be 100% secure but it’s something to weigh up.
Open a multi-signature wallet
A wallet that requires more than one signature to sign a transaction can add an extra layer of security to your assets. It distributes the risk of your digital assets falling into the wrong hands. You could then give access to multiple trusted people who would need to connect to gain access after your death.
Store private keys in a password manager
An alternative to writing passwords and private keys down is saving them in a password manager. The benefit here is that you can assign a digital heir who can be given access to your private information when you pass away. While password manager hacks are rare, they can happen, though the higher risk you face is key-logger malware that can steal your information as you type it in.
Share access to your phone and authenticator apps
With two-factor authentication more popular than ever, gaining access to accounts often requires an SMS or authentication app code. It is important to also leave your phone passcode and information on your authenticator apps in a secure place, like a safety deposit box.
How can I access my deceased loved one’s NFTs and crypto?
There are various ways your loved one may have left you access to their digital assets. However, due to the space still being in its infancy and the potential that the assets were acquired recently, inheritance provisions may not have been put in place yet.
Find out if you are named as a beneficiary
It is becoming more common for people to leave digital assets in their will. Confirm whether this information is present. Also, try to recall any conversations you may have had about crypto wallets, seed phrases, and passwords with the deceased.
If you are not named as a beneficiary, or your loved one did not leave any instructions and information on accessing their crypto wallet, there is no way to access the funds and any digital assets, such as NFTs, in it.
Contact cryptocurrency exchanges
Some exchanges, including Binance, Gemini, and Coinbase, allow for digital assets to be transferred on the provision of a death certificate and other documents.