As the finance industry changes and more people invest in cryptocurrency, we’ve been getting legal questions about cryptocurrencies. Here’s what you need to know.
What is Cryptocurrency?
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Cryptocurrency is a digital currency that uses cryptography to secure transactions. Any central authority does not control it, and it can be used to buy things electronically. You can use it just like the money in your bank account or debit card.
Difference Between Cryptocurrency and Traditional Money
There are some key differences between traditional currencies and cryptocurrencies.
For example, cryptocurrencies are decentralized – meaning any one institution or government doesn’t control them – while traditional fiat currencies (like dollars) are issued and governed by governments worldwide.
Instead of being printed on paper bills, cryptocurrency exists as code on a computer network known as blockchain technology.
This means that anyone with an internet connection has access to their own personal wallet where they store funds for future use without having to worry about fees or interest rates imposed by banks or other financial institutions.
Why Adding Cryptocurrency to Your Estate Plan Matters
It would help if you protected your cryptocurrency by adding it to your will or trust as property with a clear description of the assets and their current market value.
This will ensure that they are distributed according to your wishes when you pass away without additional legal fees or court costs involved in settling disputes over who gets what from the estate.
Your heirs won’t be fighting over whether bitcoin was worth $10k per coin at the time of death or $20k per coin. They’ll know exactly how much each asset is worth at the time of distribution based on its current market price.
Benefits of Estate Planning for Cryptocurrency
Estate planning for cryptocurrency requires a balance between the need to keep private keys secret to protect the security of the digital currency while alive and the need to pass these private keys on so they don’t remain stuck in the blockchain after the investor’s death.
As experienced attorneys, our law firm can help you find a solution that maintains this balance to ensure that your cryptocurrency can be appropriately passed on to your family.
It is a process of preparing for how your assets and personal property will be transferred to others at the time of your death, with wills and trusts playing vital roles in the process.
A Georgia will should be executed under stringent procedures that serve evidentiary, cautionary, channeling, and protective roles. In other words, requiring compliance with procedures helps ensure that a will is not tampered with and that the intent of the departed is effectuated.
There are many options and circumstances to think about when establishing an estate plan that protects your legacy and personal asset in addition to meeting your cryptocurrency objectives. Crucial choices must be made with the guidance of experienced cryptocurrency attorneys.
At the Law Office of Paul Black, we have the specialized skills, resources, and experience you need to ensure that your traditional and digital assets are in good hands.
Our Estate Planning and Cryptocurrency Services
You can protect your cryptocurrency accounts and transfer them to successors through your estate plan with cautious preparation. At the Law Office of Paul Black, our Atlanta asset protection lawyers work with clients to establish a reliable and secure access strategy for their cryptocurrency.
The following are a few of the services we offer:
- Choosing an individual who can access the cryptocurrency. Ideally, this individual should know about cryptocurrency and should not be a beneficiary of the estate.
- Composing an instruction letter for distributing the cryptocurrency that does not consist of any crypto keys, access codes, or seeds. This letter should instead contain the location and inventory of the properties and the list of hardware required to access them.
- Advising you on storing hard wallet backups in access-controlled areas in a water-resistant, fire-resistant container.
- Incapacity planning by including language in a Durable Power of Attorney supplying access to the cryptocurrency in case you become disabled.
- Dispersing the cryptocurrency through a will and naming the individual selected to access these assets on behalf of the estate.
- Placing the cryptocurrency in a trust to protect these assets and prevent the lengthy probate procedure from posing security risks and unnecessarily tying up assets.
The above list is not exhaustive. When you meet with our Georgia estate planning lawyers, our law firm can guide you through each of the ways we can help protect your cryptocurrency for your beneficiaries.
As it grows in popularity and its investors begin to age, the future of cryptocurrency is uncertain. However, what is certain is that you need a detailed and up-to-date estate plan, and you should not let your financial investment die with you.
Since this technology is still in its infancy, the laws regarding cryptocurrency are rapidly evolving and changing.
Even if you already have an estate plan covering your virtual assets, it’s important to seek renewed legal advice and re-evaluate your strategy frequently with a digital cash estate planning attorney to ensure that your estate plan abides by all updated laws and regulations well as your own personal circumstances.
Our attorneys offer customized legal advice and prepare estate planning documents to fit each person’s unique situation.
No matter your situation, we invite you to schedule a consultation with our law firm, where we will listen to your objectives and guide you through your options. Contact us online or call (404) 410-6820 today to get started.