Your family knows that you own £500,000 of Bitcoin and Your will states exactly who should inherit it but what happens to your crypto and digital assets when you die?

Your executors know that the cryptocurrency forms part of your estate.

And yet your beneficiaries may still be unable to access a penny.

That is one of the unusual problems created by digital wealth.

Traditional estate planning has largely been built around assets that can be identified and recovered. A solicitor can establish ownership of a property. An executor can contact a bank. Investment platforms have procedures for dealing with deceased clients.

Digital assets can be different.

Ownership, knowledge and access can become three separate questions.

Who legally inherits the asset?

Does anybody know that the asset exists?

And can the person who inherits it actually access it?

As cryptocurrency, digital businesses and other online assets become a larger part of personal wealth, digital assets estate planning is becoming increasingly important, particularly for internationally mobile families whose assets may already span several jurisdictions.

Crypto Does Not Disappear When You Die

One misconception about cryptocurrency is that its decentralised nature somehow places it outside conventional estate planning.

It does not.

HM Revenue & Customs treats cryptoassets as assets of an individual’s estate in broadly the same way as bank accounts, investments, shares and property.

If somebody dies owning Bitcoin, Ethereum, stablecoins or other cryptoassets, their value at the date of death may therefore need to be established and included when the estate is reported for Inheritance Tax purposes.

HMRC reinforced this point in its 2026 guidance to personal representatives, specifically warning that cryptoassets should not be missed when completing an Inheritance Tax return.

The principle is straightforward:

Digital wealth is still wealth.

The difficulty begins with identifying it.

Would Your Executors Even Know What You Own?

Consider the difference between £500,000 held at a private bank and £500,000 held in cryptocurrency.

With the bank account, there is an institution.

There are statements, correspondence, account records and regulated procedures for dealing with a client’s death.

Now imagine that the same £500,000 is held in a self-custody cryptocurrency wallet.

There may be no bank.

There may be no financial adviser.

There may be no quarterly statement arriving through the post.

There may not even be a company for the executor to contact.

The assets could effectively be represented by information stored on a hardware wallet in a drawer, protected by credentials known only to the deceased.

This is why identifying digital assets has become a genuine estate-administration issue.

HMRC’s own guidance now advises personal representatives to look for evidence such as cryptocurrency exchange accounts, payments to crypto services on bank statements, references to Bitcoin or Ethereum in emails, crypto applications on phones and computers, wallet software and records relating to recovery phrases.

That is revealing in itself.

Executors may now have to become digital detectives simply to establish what forms part of an estate.

A better estate plan makes sure they do not have to.

Custodial Crypto and Self-Custody Are Not the Same Thing

One of the most important distinctions in crypto estate planning is where and how the cryptocurrency is held.

Crypto Held on an Exchange

If cryptocurrency is held with a centralised exchange or custodian, there is normally an organisation that the executor can approach.

The process is not necessarily quick or simple. The provider may require a death certificate, proof of the executor’s authority, probate documentation, identification and other evidence before assets can be transferred.

But there is at least a process.

The executor can effectively knock on someone’s door.

Crypto Held in Self-Custody

Self-custody changes the problem completely.

The individual controls the wallet rather than relying on a bank or exchange to control the assets on their behalf.

That independence is one of cryptocurrency’s attractions.

It is also one of its estate-planning risks.

If access to the wallet depends upon a private key or recovery phrase and nobody else can obtain it, there may be no customer-service department capable of resetting the password.

There is no bank manager who can override the security.

There may be no central authority capable of restoring access.

The blockchain may continue to show that the cryptocurrency exists while the family has no practical means of controlling it.

Legal ownership and practical control can therefore become very different things.

What If Your Crypto Is Inaccessible?

This creates a particularly uncomfortable estate-planning situation.

Imagine somebody dies owning cryptocurrency worth £500,000 at the date of death.

The executors establish that the wallet exists.

They can see the assets.

They know they belonged to the deceased.

But nobody can find the information required to access them.

HMRC’s current guidance specifically considers this possibility.

Where cryptoassets belonging to the deceased are identified but believed to be inaccessible, personal representatives are instructed to explain why they are inaccessible and provide their believed value when supplying the estate information.

In other words, losing access does not mean the asset simply ceases to exist for estate-administration purposes.

This is why planning for cryptocurrency cannot begin and end with writing:

“I leave my cryptocurrency to my children.”

The estate also needs a practical mechanism through which the appropriate people can discover and ultimately gain control of those assets.

Should You Put Your Crypto Passwords in Your Will?

No.

A will should establish your wishes and determine who should inherit your assets.

It should not become a list of passwords, private keys and cryptocurrency recovery phrases.

There is a very practical reason.

In England and Wales, once probate is granted, a will generally becomes a public document.

Putting the information capable of controlling a cryptocurrency wallet directly into that document could therefore create an obvious security problem.

Instead, digital estate planning needs to separate two things.

The legal instructions establish who should receive the assets.

The access arrangements provide an appropriate and secure mechanism through which those assets can eventually be recovered.

Those arrangements need careful thought.

Too little information may leave the assets inaccessible.

Too much information stored insecurely can undermine the security that self-custody was designed to provide.

The objective is not to give everybody access while you are alive.

It is to make sure the right people can obtain the right information, through the right process, when it becomes necessary.

Crypto Is Now Clearly Part of the Property Conversation

The legal framework surrounding digital assets has also continued to develop.

The Property (Digital Assets etc) Act 2025 provides statutory confirmation in England and Wales that an asset is not prevented from attracting personal property rights merely because it does not fit neatly within the two traditional categories of personal property.

The reform was developed partly in response to assets such as crypto-tokens that challenge traditional legal classifications.

For estate planning, the wider message matters.

Digital assets are not an obscure parallel financial universe.

They increasingly sit alongside conventional property, investments and business interests as part of modern personal wealth.

The estate plan needs to evolve accordingly.

How Is Cryptocurrency Valued When Someone Dies?

Crypto creates another problem: volatility.

For estate purposes, the relevant question is generally what the asset was worth at the date of death.

That can produce uncomfortable results.

Suppose someone dies holding 10 Bitcoin worth £80,000 each.

The cryptocurrency holding is worth:

£800,000 at the date of death.

Now suppose the market falls significantly while the estate is being administered.

The family’s economic position may have changed considerably, but the date-of-death valuation remains an important part of determining the estate’s position.

There is another important distinction.

HMRC states that cryptoassets do not qualify for the Inheritance Tax loss-on-sale relief available for certain other assets such as qualifying shares.

For executors dealing with a large and volatile crypto portfolio, that difference can matter.

Accurate records are therefore important.

Executors need to understand what tokens were owned, how many were held, where they were held and what methodology has been used to establish their sterling value.

For substantial portfolios, this may require specialist valuation and tax advice.

What About UK Expats Who Own Crypto?

This is where digital estate planning can become considerably more complicated.

A British national living overseas might assume that cryptocurrency held through an overseas exchange, or in a self-custody wallet while they live abroad, automatically sits outside the UK estate.

That assumption can be dangerous.

From 6 April 2025, the UK moved from a domicile-focused system for the taxation of foreign assets on death toward a residence-based Inheritance Tax framework.

An individual’s UK residence history can now determine whether overseas assets fall within the scope of UK Inheritance Tax.

For internationally mobile individuals, leaving the UK does not necessarily end potential UK exposure immediately.

Residence history matters.

Crypto adds another layer because digital assets do not have an obvious physical location in the way that a London property or Swiss bank account does.

HMRC itself acknowledges that cryptoassets are digital and therefore have no physical location. Its guidance contains specific principles for determining the location, or “situs”, of exchange tokens for tax purposes.

For certain exchange tokens without an underlying asset, HMRC’s position looks toward the residence of the beneficial owner, although Inheritance Tax can also involve common-law principles and applicable double-taxation agreements.

This means the simplistic argument:

“My Bitcoin isn’t in Britain, so it can’t be subject to UK tax”

does not adequately address the issue.

For internationally mobile families, cryptocurrency should be reviewed alongside the rest of the family’s cross-border estate.

Digital Assets Are Much Bigger Than Bitcoin

Cryptocurrency gets most of the attention, but a modern digital estate can extend considerably further.

It may include:

• Bitcoin, Ethereum and other cryptoassets
• stablecoins
• NFTs and tokenised assets
• cryptocurrency exchange accounts
• self-custody wallets
• domain names
• websites and online businesses
• monetised YouTube or social-media channels
• digital intellectual property
• online royalty streams
• cloud-held business records
• valuable digital content
• software and online commercial assets

Not every online account is automatically an asset that can simply be transferred to a beneficiary.

Platform terms, intellectual-property rights, contracts and the nature of the underlying asset all matter.

But this is precisely why digital assets should form part of the estate-planning conversation.

Twenty years ago, an executor might have looked for property deeds, bank statements, share certificates and insurance documents.

Today they may also need to understand domain registrars, cloud accounts, cryptocurrency wallets, subscription businesses and digital intellectual property.

For some entrepreneurs, the digital part of the estate may be worth more than the physical one.

What Happens to a Digital Business?

Consider an entrepreneur who owns a website generating £15,000 each month.

The domain is registered in their name.

The website sits on a hosting account only they can access.

Customer payments run through an online payment processor.

Important files sit in cloud storage.

The company’s social-media accounts provide most of its customer acquisition.

From a valuation perspective, the business may be substantial.

Operationally, however, it may depend on a collection of usernames, passwords, two-factor authentication devices and accounts controlled by one person.

If that person suddenly dies, the problem isn’t simply:

Who inherits the company?

It is:

Who can operate it on Monday morning?

That distinction becomes especially important for owner-managed businesses and internationally mobile entrepreneurs.

Digital continuity is increasingly part of estate planning and succession planning.

The Three Questions Every Digital Estate Plan Should Answer

A useful digital estate plan should ultimately answer three questions.

1. What do I own?

Create an appropriate inventory of significant digital assets.

That does not mean putting every password into a spreadsheet.

It means ensuring there is a reliable record of what exists.

Your executors should not have to discover a significant cryptocurrency portfolio by finding an old exchange transaction on a bank statement.

2. Who should receive it?

Your will and wider estate-planning arrangements should properly reflect your intentions.

This becomes particularly important when digital assets are valuable, commercially important or spread between jurisdictions.

3. How will the appropriate person access it?

This is the question traditional estate planning can easily overlook.

The answer will depend upon the asset.

An exchange account may require an executor to follow the provider’s bereavement procedure.

A self-custody wallet requires a completely different approach.

A digital business may need continuity arrangements so that somebody can access hosting, domains, payment systems and critical operational accounts.

The solution should be secure enough to protect the assets today while providing a controlled route to access them tomorrow.

Don’t Create a Security Problem in the Name of Estate Planning

There is a balance here.

Writing down every private key and handing copies to several family members is not sophisticated digital estate planning.

Neither is leaving absolutely no information behind.

The first approach can compromise security while you are alive.

The second can make assets impossible to recover after your death.

Good planning sits between those extremes.

For substantial digital wealth, the conversation may involve your estate-planning adviser, solicitor, tax adviser and, where appropriate, specialist digital-asset expertise.

The structure should reflect both the legal ownership of the assets and the practical realities of accessing them.

Digital Wealth Has Changed Estate Planning

For generations, estate planning has centred around a relatively simple question:

What do you own, and who should receive it?

Digital wealth introduces another:

Will they actually be able to find and access it?

That question matters whether the asset is £10,000 of cryptocurrency, a seven-figure self-custody portfolio or an online business that supports an entire family.

For internationally mobile families, the situation can be more complicated still.

Residence history, different legal systems, tax exposure, the location of family members and the structure through which digital assets are held can all affect the eventual outcome.

The worst time for a family to discover that nobody understands the digital estate is after the person who created it is no longer there to explain it.

Start With a Digital Estate Review

If cryptocurrency, digital businesses or other significant online assets form part of your wealth, they should form part of your estate planning too.

At Carey Suen, we help internationally mobile individuals and families look at their wealth as a whole: what they own, where it is held, how their residence history affects their position and whether their existing estate arrangements still achieve what they intended.

A digital asset may exist entirely online.

The consequences of failing to plan for it are very real.

If you are unsure how your digital assets fit into your existing estate plan, arrange a Discovery Call with Carey Suen to review your position.

This article is provided for general information only and does not constitute legal, tax or financial advice. Cryptocurrency, inheritance and cross-border estate planning can involve complex individual circumstances. Professional advice should be obtained based on your own position.