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Cryptocurrency Counselors: Yes, your cryptocurrency needs to be in your estate plan

CryptocurrencyBy: Anthony Cetrangelo, Esq.

Who would have ever believed that Bitcoin would hit a record high of $63,000.00 in 2021? Wasn’t it just worth a couple of cents around a decade ago in 2010? Many skeptics are starting to accept that more likely than not, cryptocurrencies are here to stay and we must plan accordingly.

What exactly is “cryptocurrency”?

Basically, cryptocurrency is a digital currency built on “cryptography” to preempt counterfeit transactions. In the media, the latest buzzword is “Blockhain”. A majority of cryptocurrencies run on a decentralized network through Blockchain technology. The information that is stored on these decentralized networks is extremely secure and almost considered impossible to break into or hack.

Cryptocurrency and estate planning

Digital wallets are what cryptocurrencies are stored in. These wallets will contain extremely important information of the user such as their private and public keys. These keys are used to receive and send cryptocurrency. There are different variations of wallets out there either based online or in physical form. This is where the tricky part comes into estate planning. The owner of the cryptocurrency should be the only one that has access to their keys and passcodes to their digital wallet, but this complicates estate planning matters if the investor suddenly passes away.

Ironically, cash and cryptocurrencies share a material trait in common. Can you guess what that is? They are not traceable assets. They don’t come with monthly statements and it’s up to the owner to keep up with their records for the most part. That is why it is especially important to meet with your estate planning attorney and develop a method to ensure your wallets and passcodes are not lost at death incidentally along with all the value of your cryptocurrencies.

At Henderson Franklin, we advise clients to specifically reference cryptocurrency in estate planning documents, such as in a Last Will and Testament or Trust. Specifically referencing the cryptocurrency in an estate plan will ensure that the named personal representatives and/or trustees learn of its existence and allows them the ability to take further measures when necessary. Failing to plan is planning to fail. If you don’t list these assets in your estate plan, the unintended consequence is potentially allowing the cryptocurrency assets to be forgotten or inaccessible to your future beneficiaries and fiduciaries. Residents of Florida will also want to make sure that their estate plan is up to date and contains the current statutory powers under Florida Law to allow your fiduciaries to have the proper powers to act.

Florida law governing digital assets

Under Florida statute, the Fiduciaries Access to Digital Assets Act (“FFADAA”) applies to fiduciaries in estate administrations, cryptocurrencies and the wallets/exchanges in which they are held. Under this statute, fiduciaries are given authority to manage digital assets. Duly-appointed fiduciaries are only provided these statutory powers, if expressly granted by the testator, settlor, or principal, in their Last Will and Testament, Trust Agreement and/or Power of Attorney.

Public records

Since Last Will and Testaments become public record during the probate process, you would not want to list your cryptocurrency keys and passcodes to your digital wallet inside of it, ever. Instead a better method may be to have the testator leave the cryptocurrency keys and passcodes directly to their fiduciary or to keep them securely stored in a safety deposit box which the fiduciary will have access to at the testator’s death in order to facilitate distributions to the beneficiaries. It is key to not undermine these highly secure keys and passcodes to access the digital wallet by allowing them to get into the public domain because if they are subject to scams or a breach of security you or your beneficiaries will probably not be able to recover the losses, as cryptocurrency is at this time not regulated by our government or backed by it.


Last but not least, what is the old adage? Two things are certain in this life, death and taxes. Remember, that just because cryptocurrency is not very public or mainstream yet, it does not mean that you can hide your gains in them from Uncle Sam. In fact, the Internal Revenue Service (IRS) has addressed this issue in Notice 2014-21. Notice 2014-21 declares that cryptocurrency is not considered “currency” but is actually considered “property.” This means that capital gains taxes apply to cryptocurrency and should be reported with your CPA accordingly.

Those interested needing cryptocurrency estate planning assistance may contact me at or by phone at 239-344-1358.

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