Recently I have come to know some terms through contacts with clients and other professionals. They include bitcoin, cryptocurrency, block chain technology and NFT (Non Fungible Tokens). I was already familiar with a related topic, digital assets, the subject of a Pennsylvania law passed in 2020 with the jaw breaking title, the Pennsylvania Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA). The simplest way to explain the popularity of these issues is to relate them to our increasing dependence on on-line technology and the avenues this dependence opens both to opportunity and abuse. To those outside the cryptocurrency world, there is an entirely different approach to money and the transfer of assets than what we have traditionally understood since we first accepted cash, then checks, then credit and debit cards, then ACH debit and similar on-line transactions to today’s virtual world. One question we might ask is how far this progression will go and how popular it might become. Another question is, assuming this form of virtual currency continues to progress in use, how can these virtual assets be transferred to succeeding owners and succeeding generations such as through their estate plans. May the information be contained in an estate plan by Will or Living Trust and how could this be done without losing the secure access? One hint is, if the access is divided among many sources but could be accessible to the eventual user, would this help?
How secure is cryptocurrency and, if it is extremely secure, how can the intended succeeding owners obtain access when the asset is supposed to be transferred? Apparently if you lose the key, it is gone forever. For people who may have difficulty locating access to documents and emails, this can be a real challenge.
As one author quoted “If nobody knows you have it, it’s gone…Somebody has to find those keys and know what they mean. It’s not good if your grandma cleans out your closet and finds that string of numbers on a piece of paper and doesn’t know what they are…” “What holding Cryptocurrency Means for Your Estate Plan,” U.S. News and World Report, by Emma Kerr, October 5, 2021.
Esquire, Colliton Law Associates, P.C. Janet Colliton has practiced law for over 38 years, 37 of them in Chester County, Pennsylvania, a suburb of Philadelphia. Her practice, Colliton Law Associates, PC, is limited to elder law, Medicaid, including advice, applications and appeals, and other benefits planning including Veterans benefits, life care and special needs planning, guardianships, retirement, and estate planning and administration.