In the world of digital or virtual money, a cryptocurrency is digital or virtual currency protected by cryptography, which makes counterfeiting and double spending almost difficult. Many cryptocurrencies are based on blockchain technology, which is a distributed ledger enforced by a global network of computers used to create them. Unlike traditional currencies, cryptocurrency is defined by the fact that it is not issued by a central authority, which makes it theoretically immune to government interference or manipulation.
The government or monetary authorities grant fiat currencies their power as a medium of exchange. Cryptocurrencies, on the other hand, are not backed by any government or commercial entity. As a result, establishing their legal status in many financial countries around the world has proven problematic. The fact that cryptocurrencies have mostly operated outside of the current financial infrastructure doesn’t help matters. The legal status of cryptocurrencies has ramifications for their use in regular transactions and commerce. El Salvador was the first country in the world to accept Bitcoin as legal tender for monetary transactions starting in December 2021. Cryptocurrency regulation in the rest of the world differs by jurisdiction.
Unlike traditional money, cryptocurrency has no physical form. It is a digital asset that can only be used online. Cryptocurrency can only be accessed if you have the private key, which is usually kept in a digital wallet for security.
Traditional investment accounts are not the same as cryptocurrency accounts. They are more prone to security risks and you cannot specify a beneficiary in most cases.
Cryptocurrency, like other assets like money, property, and personal property, can be incorporated into an estate plan. Gifting bitcoin or altcoin, on the other hand, requires additional steps due to its secure nature.
A crypto-asset cannot be accessed without its private key. This implies that your cryptocurrency will be lost to the digital ether if you die without providing a mechanism for someone to find and access the private key. The asset will remain under your control and your personal information will remain encrypted, but it will be lost and inaccessible. This is why it is crucial to include cryptocurrencies in your estate plan.
Inheritance laws relate to the legal rules that govern the disposition of an individual’s property after death. The sequence in which one person in preference to another, one person after another, or one person in specific sharing with another person succeeds to the property/estate of the deceased person are examples of this. Legal persons with continuous existence are exempt from this provision and are subject to separate legislation governing liquidation, reorganization and closure.
It is possible to divide the rules of succession into two broad categories: first, when the deceased left behind a legitimate and enforceable “will”; and second, when the deceased died without leaving a valid and enforceable will.
A will is a written document that expresses the wishes of a deceased person regarding the disposition of their estate after their death. After determining that the will is authentic and enforceable, the estate of the deceased would be dispersed according to the terms of the will.
Any person legally competent to enter into a Contract may draw up a will. Minors or any person under the influence of intoxicants or any other type of influence such as coercion, fraud or an episode of illness that robs them of their free will or their ability to understand the consequences of their actions are not unable to form a will while in this state.
According to Section 2(h) of the Indian Succession Act 1925, a “will” is a legal declaration of a testator’s intention in relation to his property, which he wishes to put into effect after his death. .
For Wills, the Indian Succession Act of 1925 does not specify any particular format or technical necessity. Essential elements include:
Written clearly, the purpose of the writer (also known as the testator) should be apparent. To achieve the testator’s goal, even minor typos and inaccuracies in the document name or ownership data can be overlooked in favor of reading the entire document to get the complete picture. The testator and two witnesses must sign it. If you cannot sign because you are illiterate or have a medical condition, you can use your thumbprint. The signature should be placed at the bottom or end of the document to demonstrate that it is used to implement the previous or previous text. Witnesses must be non-beneficiaries of the will and must not be related to the testator. Their favor or that of their wife would be invalid if arrangements had been made. However, the validity of his signature as a witness is not affected. The law does not define specific terms or formats. Also, wills do not have to be written on legal paper.
Shares are included in wills. Inherited stock is stock that is passed from one generation to the next when the original owner of the stock dies. The growth in value of the stock from its acquisition until the death of the deceased is exempt from tax. As a result, the beneficiaries of the shares will only be liable for income from capital gains realized during their own lifetime.
On the other hand, the decentralized nature of cryptocurrencies means that they leave little to no paper trail, making it almost difficult to find them without the proper tools. If you don’t include Bitcoin in your will and your beneficiaries don’t know about it, they may never know. To avoid falling into this trap, provide a detailed description of your Cryptocurrency (and its location) in your will.
A physical crypto wallet, such as a USB drive, is an alternative to digital wallets managed through an app or website. What you do with your crypto will determine which type you use. Therefore, it is absolutely essential that a comprehensive estate plan be drawn up. Set up your estate plan so that your crypto assets, along with any passwords, PINs, or keys you have, go to a named beneficiary. A cryptocurrency exchange’s customer support can be contacted by your heirs to alert them of your death.
A Coinbase analyst is available to help relatives, according to a Coinbase spokesperson. To initiate a transfer from a deceased person’s account, Gemini requires a death certificate and power of attorney.
Keeping your estate plan up to date, especially after a major life transition like marriage or divorce, is the best way to ensure your assets go to the right people. Make sure your beneficiaries have access to the most recent versions of your instructions. Periodic firmware updates are also all cold wallets need. That way, your loved ones won’t have to go through the emotional stress of settling your estate when you die.
CONCLUSION
It can be concluded that cryptocurrencies can be included in a will. However, there are some caveats in this regard. Cryptocurrency demands more consideration than traditional assets when it comes to leaving it to your loved ones after you die. There are some preparations to make to make the process easier for recipients and to ensure they receive the coins when the time comes. People have the option of providing all the essential information themselves or hiring an estate planning attorney. Making sure loved ones are aware of your bitcoin holdings and have the proper information to access them after someone dies is the most important thing you can do to prepare for the worst-case scenario.
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