DeWitt Law Firm
By Michael Bezoian
January 2nd, 2025
Blockchain technology is changing the way we think about digital ownership and estate planning. By understanding how blockchains work and how digital assets are stored and transferred, one can make informed decisions about how to protect these assets for future generations.
Estate planning today isn’t just about physical assets; it’s also about protecting your digital legacy. Whether through a custodian or by keeping your private keys secure, taking the right steps now will ensure your digital assets are safely passed on when the time comes.
Blockchain Assets in Estate Planning
Estate planning is about making sure that your belongings, including real estate, investments, and other property (including digital assets), are passed on to the people you choose after you pass away. In today’s digital world, you might have assets stored on the blockchain. But because these assets are digital, it’s not as simple as writing them down in a last will and testament.
For example, wills are public documents that must be filed with the court under Wis. Stat. § 856.05—even if a probate is not required. Including a private key in a will may inadvertently make that private key a public record.
Similarly, given that digital assets are not “titled” in the traditional sense (beyond merely having an alphanumeric address associated with a given wallet) and not necessarily held by a centralized authority, there is a question concerning the logistics of how one can pass digital assets upon one’s death in a safe, secure manner.
Moreover, many holders of digital assets have a high concentration of their net worths in cryptocurrencies or NFTs. Many digital asset holders are opposed to the diversification of their blockchain-based assets with non-blockchain (or “centralized finance”) assets. For clients and fiduciaries (e.g., trustees and personal representatives) alike, an additional question exists regarding the default requirement under the Prudent Investor Act (Wis. Stat. § 881.01(4)(a), in particular) to diversify investments.
