Cryptocurrency and Inheritance Issues
As investments in cryptocurrencies have increased in recent years, the handling of cryptocurrencies when the owner passes away has become a problem. Cryptocurrencies have different characteristics from traditional financial assets, and therefore require special attention when it comes to inheritance.
Characteristics of Cryptocurrencies
Cryptocurrencies are managed using distributed ledger technology (blockchain), and there is no centralized administrator. In other words, ownership of cryptocurrencies is managed by private keys. Only those who have the private keys can use the cryptocurrencies.
Problems with Inheritance
When a cryptocurrency owner dies, the heirs need to obtain the private keys in order to access the cryptocurrencies. However, in many cases, the owner has not shared the private keys with anyone else, making it difficult for the heirs to obtain them.Moreover, cryptocurrency transactions are highly anonymous, so it may be difficult for heirs to even know of the existence of the cryptocurrencies when the owner dies.
Countermeasures
It is important for cryptocurrency owners to take the following measures while they are still alive:
- Management of private keys: Store private keys in a safe place and inform a trusted person.
- Creation of a will: Include information about cryptocurrencies in the will and inform the heirs.
- Consultation with experts: Consult with lawyers and tax accountants who are knowledgeable about cryptocurrencies and take appropriate inheritance measures.
Response of Heirs
Heirs need to take the following actions:
- Confirmation of the existence of cryptocurrencies: Confirm the existence of cryptocurrencies from the deceased’s belongings and will.
- Obtaining private keys: Obtain the private keys that were communicated by the deceased.
- Transfer of cryptocurrencies: Use the private keys to transfer the cryptocurrencies to the heirs’ control.
- Payment of taxes: Inherited cryptocurrencies are subject to inheritance tax, so it is necessary to properly declare and pay taxes.
Conclusion
Inheritance of cryptocurrencies requires special attention because it has different characteristics from traditional financial assets. It is important for owners to take appropriate measures while they are alive, and for heirs to respond appropriately based on the information provided by the deceased.As cryptocurrencies become more widespread, the issue of inheritance is expected to become increasingly important. Cryptocurrency owners should not neglect inheritance measures in order to protect their assets.