What happens to your crypto when you die?

The short, uncomfortable answer: if nobody has your keys, nothing happens. Your crypto sits at its address forever, visible to everyone and spendable by no one. Here is how that plays out in practice — and five ways to prevent it.

By the Will & Key project team · Last verified 24 September 2026 · Editorial policy

Direct answer: custodial crypto may be released through an exchange's estate process, but self-custodied crypto does not move automatically at death. A valid private key, recovery method or pre-arranged smart-contract mechanism is still required. A will can decide who should inherit; it cannot make a blockchain accept a court order.

Review status: technically reviewed by the Will & Key project team on 24 September 2026. No independent legal, tax or security reviewer has approved this guide.

Key takeaways

An exchange account and a self-custody wallet follow different recovery paths.
The device is replaceable; the private key or wallet backup is the real control point.
Discovery, legal entitlement and technical access are three separate problems.
The safest plan names an heir without placing a spendable secret in ordinary paperwork.

The part of your estate that ignores the law

When you die, most of your property passes to your heirs through a legal process. A court can order a bank to release your accounts. A registrar can transfer your house. An insurer can pay your beneficiaries. Every one of those transfers works because an institution controls the asset and must obey the order.

Self-custodied crypto has no institution. A Bitcoin address is controlled by whoever knows its private key — not by whoever a court says should control it. A probate order naming your heir is, to the Bitcoin network, a piece of paper. If the key died with you, the coins are not "transferred to the estate." They are simply unspendable, forever, while remaining publicly visible on chain. Your family may be able to see the inheritance they cannot touch.

No reliable public dataset separates crypto lost through death from assets lost for other reasons. The useful planning fact is simpler: a blockchain does not provide a deceased-owner recovery desk.

Ethereum's account documentation makes the technical boundary explicit: an externally owned account is controlled by its private keys, while a contract account is controlled by deployed code. Legal authority and signing authority therefore need a bridge in the estate plan.

What actually happens, case by case

Crypto on an exchange

Current provider evidence: Coinbase asks for a death certificate, probate authority, identification and signed transfer instructions, submitted through its Executor Services form from a Coinbase account the claimant signs in to or creates. Kraken publishes a similar claim process. Neither currently lets an individual account holder name a beneficiary, so these accounts pass through the estate process. Requirements can change, so use the provider's current page rather than copying a checklist into a will.

An exchange can respond to legal documents because it controls the account infrastructure and keys under its terms. That offers an estate process but retains provider, account-security and availability risk. An exchange account the family does not know exists can still be missed, so the inventory should identify the provider without recording login credentials.

A hardware wallet in a drawer

Trezor describes the wallet backup as the ordered words needed to recover access, and Ledger states that anyone holding its recovery phrase can recreate the wallet. Both manufacturers warn against sharing or digitizing that secret.

The device itself is nearly irrelevant; the seed phrase is everything. If your family finds the wallet but no PIN and no seed phrase, the coins are gone. If they find the seed phrase, they have everything — which cuts both ways: anyone else who finds it first also has everything. A hardware wallet without a succession plan is a very durable way to lose money slightly more slowly.

A seed phrase in a will

Probate visibility is jurisdiction-specific. As a concrete example, the official England and Wales service lets the public order a probate record including the will, and new records go online about 14 days after probate is issued. California courts also list wills and probate records among superior court case records, and the public may request copies unless a record is confidential by law or sealed by a court order. Confirm the rule where the estate will actually be administered.

Worse than it sounds, and covered in depth in why you should never put your seed phrase in your will. Two facts collide: a will becomes a public court record in probate in many jurisdictions, and a seed phrase in a public record is an open invitation. And before probate, a will is typically stored with people — lawyers, witnesses, relatives — any of whom can spend your coins while you are alive if the phrase is written in it.

Nothing at all

The default. The family knows "there was some Bitcoin" and finds nothing, or doesn't know at all. No customer support exists. No recovery process exists. This outcome is permanent.

Five inheritance methods, honestly compared

Approach	Control while alive	Heir's task	Operator dependency	Main failure mode
Exchange or custodian	Provider controls keys under its account terms	Prove death and legal authority	High	Account undiscovered, provider failure or delayed documents
Full seed shared now	Owner and every copy-holder can spend	Restore and move funds	None	Premature theft or exposed copy
Multi-share backup	Recovery requires a threshold of shares	Find and combine valid shares	None after setup	Too few surviving shares or unclear instructions
Multisig	A threshold of separate signers controls funds	Coordinate enough keys and wallet metadata	Usually low	Threshold, signer or configuration loss
Smart-contract switch	Owner controls vault subject to fixed code	Claim after inactivity; settles after challenge window	Depends on design	Missed check-ins, bad beneficiary address or contract defect

The first four all share one structural weakness: they require either trusting an institution, trusting your heir with live spending power, or trusting your family to execute a multi-step cryptographic ceremony years from now under grief. The fifth — the dead man's switch — is designed so your heir can claim after you stop checking in, and the claim settles only after a challenge window during which you can veto.

Worked example: one family, three custody types

ExchangeInventory lists provider and public account ID; executor follows its current estate process.

Hardware walletWill points to a separate recovery protocol; the will contains no seed phrase or PIN.

Contract vaultBeneficiary wallet, inactivity period and challenge window are rehearsed with a test amount.

The executor first confirms the legal allocation. A technically capable helper then handles each custody path separately. Nobody receives all secrets in advance, and the family has a current inventory without turning that inventory into a spending credential.

Download the printable crypto inheritance checklist. It separates discovery, legal instructions, secret storage, transfer mechanism and rehearsal so no single page becomes a master key.

Download checklist (PDF)

This is what Will & Key does. A self-custody vault on Ethereum L2: deposit, name your heir's wallet, check in on your schedule. Go silent past your chosen period and your heir can claim; you keep a veto window; after it, anyone can finalize the claim and the heir withdraws the settled funds. No custodian, no seed-phrase sharing, a 0.5% fee only when an inheritance actually settles.

See how it works

Whichever route you choose, do these three things

Make the inheritance findable. Your family can't claim what they don't know exists. A sealed letter that says what you own and where the instructions are — without containing any secrets itself — solves the discovery failure for free.
Keep custody cold. Whatever succession plan you pick, the coins themselves belong on a hardware wallet, not an exchange. (A Ledger or Trezor is under $200 — less than an hour of an estate lawyer's time.)
Rehearse once. Whatever your heir must eventually do, have them do a dry run now, while you're alive to correct it. Every recovery plan that has never been rehearsed is a hypothesis.

The tax and legal boundary

Property, probate, fiduciary-access and tax rules are jurisdiction-specific. In the United States, the IRS treats digital assets as property for federal income-tax purposes and expects sufficient transaction records. Brokers must report certain digital-asset sales and exchanges on Form 1099-DA, starting with transactions on or after 1 January 2025. A 1099-DA or broker substitute statement in the owner's name can therefore point to an account the family did not know about; its absence does not rule out an account, because brokers report only sale transactions they effect for customers. None of that answers state probate, estate- or inheritance-tax, or foreign-law questions. Ask a qualified professional to reconcile the on-chain transfer mechanism with your will, beneficiary designations and local law.

Next: a practical crypto inheritance plan you can finish this weekend.

Important limitation: technical access is not the same as legal entitlement. A wallet transaction can succeed while still creating disputes, reporting duties or tax consequences. Nothing here is legal, tax or investment advice.