Safeguard your Crypto with AasaanWill

n our First Blog, we will cover the fundamentals of Cryptocurrency and the best ways to include cryptocurrency in a Will.

Cryptocurrency is a very recent innovation, and as such, leaving cryptocurrency in a Will can be a relatively unknown area. If you are among many Indians who have invested in cryptocurrencies like Bitcoin, Ethereum, Shiba, Doge, MANA, etc., you may be trying to figure out how to include the cryptocurrency investment(s) in your estate plan.

Why is this a big deal for the Indians?

India has the highest number of crypto accounts. There are estimated to be more than 10 crore crypto holders in India. The US came in a distant second in terms of crypto owners at 2.74 crore, followed by Russia (1.74 crore) and Nigeria (1.30 crore).

In comparison, the number of stock investors (Unique Client Codes) registered with the BSE in India has risen from 7 crore in June 2021 to 8 crore at present. Crypto exchanges have seen more growth than stock trading apps. E.g., Zerodha at present has over 7M users, against 11 million at CoinSwitch Kuber and 8.3 million at WazirX. 

The swift increase in the number of crypto owners creates an urgent need for the inclusion of cryptocurrencies in estate planning. Platforms like AasaanWill simplify this process by offering affordable, legally valid Will-drafting services that explicitly cover digital assets.

Know that simply gifting Bitcoin isn’t effective. You also have to make sure that your beneficiaries know how to find and access the cryptocurrency you bequeathed to them. 

Difference Between Cryptocurrency and Traditional Money or Assets 

Most millennials and GenX are keen to diversify their portfolio with crypto. This now becomes part of their Estate. Unlike traditional money, cryptocurrency has no physical form. It’s an asset usable only in the digital space. For security reasons, cryptocurrency can’t be accessed unless you hold the private key, which is typically stored in a digital wallet.

Family members are often unaware of all of a person’s assets; this issue is particularly more acute for some kinds of assets that cannot be easily traced. Cryptocurrency can be included as a part of an estate plan along with other assets such as money, property, and personal belongings. However, because of its secure nature, gifting bitcoin or an altcoin requires extra steps.

The act of passing on or transferring real property (real estate) typically involves some documentation and transferring your keys to your intended beneficiary. However, when it comes to bequeathing cryptocurrency, you will have to develop a safe method to allow your intended beneficiary to obtain your private keys while ensuring that they remain secure.

Without access to private keys, it may be impossible to access cryptocurrency immediately, if at all. Experts strongly advise specifying safe access instructions in a properly executed Will, and the services of AasaanWill help users provide such important instructions while maintaining confidentiality.

Continue reading to learn how to carry out this process.

Where does your Cryptocurrency go when you die?

Without the private key, there is no way to access a crypto asset. That means that if you die without leaving instructions on locating and accessing the private key, your cryptocurrency will essentially be lost in the digital ether. Although the asset remains in your possession, and your private Will remains a part of the cryptography, it will be lost and inaccessible. That’s why adding cryptocurrency to your estate plan matters. 

Numerous widely reported cases show families unable to recover crypto due to lost or undisclosed private keys. Not planning risks the permanent loss of your investment.

Why is Including Your Cryptocurrency in Your Estate Planning is so Important?

The best way to be absolutely sure that your beneficiaries will have access to the cryptocurrency that you own is to include the cryptocurrency in your estate plan, be it a Will or a Trust. This applies to all types of digital assets as well. 

Your estate plan gives you the authority and instructions legally needed for you to transfer the cryptocurrency and private key information to your beneficiaries. This is a great way to allow your private keys to be used by your beneficiaries after you die, while still keeping your private keys secure and private during your lifetime. 

It is recommended by many legal Advisors to name specific cryptocurrencies, digital wallets, and private key access procedures in the Will to avoid litigation and ensure compliance with tax rules. AasaanWill's Will-drafting services easily incorporate these legal requirements clearly, thus preventing uncertainty during the course of probate.

How Does Cryptocurrency Work for Your Beneficiaries when You Die?

Upon your death, the Executor distributes your properties and assets per your Will. To leave cryptocurrency to loved ones, include a specific provision for it.

• Ensure the Nominee on your crypto exchange and your Will identifies the same person as the legal heir to avoid conflicts.

In this provision, you should specify which cryptocurrencies and the number of coins you own. In addition, you’ll leave instructions on how to access your private key and digital wallet via a separate document. In our second blog, we’ll guide you on transferring your private key information and the different types of digital wallets you can choose from.

To further protect against probate delay or disputes, you should match the exchange nominee details with a Will. This is becoming more common as many Indian Crypto exchanges now support such Inheritance features, which complement legal Wills.

Most Asked Questions Regarding Cryptocurrency & Estate Planning in India

Q: Is it lawful to add cryptocurrencies to a Will in India?

A: Yes. While cryptocurrency is not yet explicitly regulated under a dedicated statute in India, it is generally recognized as a form of property under the Indian Succession Act, 1925, and can be included in a valid Will as a movable asset. Courts recognize digital assets as inheritable if clearly specified in the Will. Thus, including cryptocurrency in your Will legally declares your intent to transfer ownership to your beneficiaries, ensuring enforceability under existing succession laws.

Q: What happens if you pass away without listing your cryptocurrency within a Will?

A: In the absence of a Will specifying cryptocurrency ownership and access instructions, the digital assets will be treated as intestate property. Since access depends on private keys, which are not openly available, heirs may face significant difficulty recovering the assets. Legal remedies such as obtaining succession certificates or letters of administration do not guarantee access to private keys or wallets, often resulting in permanent loss or inaccessibility of cryptocurrencies.

Q: Are there risks to privacy when including crypto in Wills?

A: Yes. Since a Will may become a public document during probate, including private keys or sensitive access information directly risks exposure to theft or misuse. To protect privacy, such information should be stored separately and only referenced indirectly in the Will. Professional estate planning services, like AasaanWill, use secure methods to safeguard private keys and balance legal enforceability with privacy, ensuring digital assets are protected without compromising security.

Conclusion

As many Indian portfolios continuously invest in cryptocurrency, it is essential to plan for these digital assets in your estate planning to safeguard your digital wealth. Cryptos are treated differently from physical assets since they are stored digitally and because there is no guidance forthcoming from Indian succession laws. Most holders of crypto in India are unaware of Inheritance complexities. Professional Will-drafting services, such as  AasaanWill, provide you with a legal Will that includes your crypto-asset holdings.

AasaanWill ensures that your private keys and access instructions are safely documented in a Will, helping safeguard your legacy and ensuring your digital assets are smoothly transferred to your heirs without legal complications. Planning is crucial to prevent loss and disputes. 

You can visit us on AasaanWill. Zaroori Hai!