How to safely inherit the cryptocurrency heritage?

Author of this article: Ye Yang

Since Satoshi Nakamoto released his first Bitcoin software in 2009, virtual currencies have developed greatly and have been tested by the market and have become a foothold, from a previous niche speculative project to a popular investment project. To this day, virtual currencies are favored due to their decentralization, anonymity, and global characteristics. More and more people are considering adding a portion of virtual currency investment in their asset allocation. However, the advantages of decentralization and anonymity will be reversed into disadvantages once a certain issue is involved, that is -inheritance.

Things before your death - wallet and private key

The most important thing to inherit virtual assets such as cryptocurrency is to make arrangements early in life.

In the universally anonymous decentralized virtual currency world, the wallet and its core private key are the proof of identity of this world. Conversely, as long as the wallet and private key are entrusted, inheritance will be directly completed .

The wallet is an application that manages virtual currency. The mainstream wallets are divided into three types: PC wallet, browser extension wallet, mobile wallet, hardware wallet, PC wallet, browser extension wallet, and mobile wallet. Pay attention to the application of the wallet. The types are clearly communicated to the heirs, and the hardware wallet needs to keep the hardware equipment well to ensure that it can be handed over to the heirs intact.

The private key is equivalent to the user name and password of the login wallet. When used, the private key is converted into a mnemonic word. When conveying it to the heir, the correctness of the mnemonic word is required. If it has a password, it is even more necessary. Convey the password usage method together.

So how should we use to convey the wallet and private key to the heirs? In the end, inheritance is just insurance. Telling the heirs in advance may cause some avoidable losses and disputes.

1. Paper and pen transfer

You can record the type of wallet (if it is a hardware wallet location), mnemonics and other information on paper, and then put it in a safe, just like the paper wallet commonly used in the currency circle. You can place the password of the safe on the will, or directly store the paper wallet in the bank's safe to ensure that the heir can only open the safe after inheriting the estate.

2. Hardware saving

You can also save the inheritance with necessary information on a USB or mobile hard drive, then set password protection, and save the hardware and password separately to ensure that the heir can access the information in the hardware through the password after inheriting the inheritance.

3. Disable switch

You can also look for disable switch applications such as the Sarcophagus project built on Ethereum and Arweave. Specifically, you can upload and inherit the necessary information in the application, which will be encrypted and stored on the network permanently. At the same time, you need to set a file decryption time and specify your heir as the recipient. Before the decryption time comes, you can choose to extend the file's storage time or terminate the service, otherwise the file will be automatically decrypted to the recipient.

The above methods have their own advantages and corresponding risks. Please choose the method that suits you to inherit your virtual assets.

Things to do after death - Centralized platform account

If you don’t have time to leave your wallet and private keys before you die, there is a high possibility that virtual assets will not be inherited. After all, decentralization is the underlying feature of virtual currency. But after so many years of development, centralized exchanges have also been developed in the virtual currency world. Exchanges have sacrificed a certain degree of decentralization and anonymity in exchange for some security and convenience. If the deceased deceased mainly uses a centralized exchange account to manage virtual assets, then as long as the heir knows the account name, he can appeal through the platform to inherit the virtual assets.

The inheritance process of each platform may be inconsistent, and the required materials are also different. This article only takes Binance as an example to introduce how to inherit the virtual currency in the account of the deceased.

Binance has a complete set of inheritance appeal process. After the heir registers his account, he will show that he is the heir and needs to inherit the inheritance, and you can directly enter the inheritance appeal page through the link of the AI ​​customer service.

The required materials are not complicated. In addition to the inherited Binance account information, the heirs also need to provide the following three items.

1. Identity documents of the heir and the deceased;

2. Death certificate of the deceased;

3. Relevant legal documents that prove the right to inheritance, etc.

The above three materials need notarized or attorney certification, and are accompanied by an English translation.

The more troublesome thing is the third item, because they have reached the stage of inheritance appeal, and they usually do not have time to leave a will to deal with the virtual property. If there is no dispute over inheritance, you can go to the notary office to apply for a notarization of inheritance right. Generally speaking, the deceased's death certificate, kinship certificate, deceased's personnel files, property certificates and other materials are required; if there is a dispute over inheritance, then it is necessary The lawyer was entrusted to conduct an inheritance dispute lawsuit, and the final effective judgment was also a legal document that could prove the inheritance right.

After submitting the above materials and passing Binance's review, you can inherit the virtual currency in the deceased's account from the heir account.

Summary of Lawyer Mankun

Virtual currency is an asset with a high holding threshold. You may avoid market volatility, hacker fraud, legal risks, etc. and accumulate considerable virtual assets, but your family may know nothing about virtual currency. In extreme cases, investors may even die, and their family members and heirs do not even know that the investor still holds a virtual property; or they only know that the investor is playing virtual currency, but they use what wallet and which platform they are all on. I don’t know; or I get virtual currency based on clues left by investors, but I step on a mine in the process of issuing the currency and a dispute arises.

Therefore, it is crucial to communicate effectively within the family. Lawyer Mankun recommends that in your daily life, you can hold more family meetings to explain to your family how virtual currency works, value and how to manage these assets. Through education and communication, it is not only about leaving a virtual asset for your family, but also about leaving your investment philosophy and management skills. This is the key to ensuring the smooth inheritance of virtual assets.