Written in Recognition of Make a Will Month
California is often out in front when it comes to societal change, and that includes emerging technologies and the development of new laws. Today that is the case when it comes to currency. About 27% of Californians own cryptocurrency, nearly double that of the rest of the country, according to the Pew Research Center.
Although 14% of U.S. adults report owning cryptocurrency, a Gallup poll reveals that ownership is highest among men ages 18-to-49 with 25% of people in this group participating. College graduates and upper-income Americans own more of these digital assets than the average.
Compared to investments in stocks and real estate, cryptocurrency is still a niche investment, but it’s worth paying attention to when drafting wills in California given the state’s high participation rate.
In recognition of Make a Will Month, we want to share some facts about digital assets for estate planners to consider. The goal is to make sure estate clients’ digital assets are accurately identified, secured, and transferred when the time comes.
Why Understanding Digital Assets Matters
While the phrases “digital assets” and “cryptocurrency” are often used interchangeably, cryptocurrency is just one type of digital asset among a range of electronically stored properties.
Digital assets include:
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- Cryptocurrency (e.g., Bitcoin, Ethereum, Tether)
- Non-fungible tokens (NFTs) and tokenized assets—such as digital art like Beeple’s “Everydays: The First 5000 Days” or collectible profile pictures from the Bored Ape Yacht Club.
- Digital wallets and exchange accounts (e.g., Coinbase, Binance, MetaMask, Ledger Nano S)
- Domain names and websites
- Cloud-based storage (e.g., Google Drive, Dropbox)
- Social media and email accounts
These assets often lack paper trails and are protected by unique wallet addresses, passwords, encryption, or two-factor authentication—making them difficult to locate or access without proper information. Failure to plan can result in lost or inaccessible cryptocurrency, delays in estate administration, and even fiduciary liability.
Common Pitfalls
Estate planners who overlook digital assets risk the following undesirable outcomes:
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- Permanent loss of crypto due to missing credentials
- Disputes among heirs over undisclosed or misunderstood assets
- Breach of fiduciary duty claims against executors or trustees
- Tax reporting errors or omissions
Health writer Tega Egwabor covered the issue in a July 2025 article for RollingOut.com. “The secretive nature of cryptocurrency holdings means that heirs often remain unaware of digital asset existence following a holder’s death,” she wrote. “Unlike bank accounts that appear in financial statements, cryptocurrency can remain completely hidden unless the deceased specifically documents their holdings and provides access instructions.”
Accessing digital assets also involves more technical knowledge than merely reading bank statements. “Technical requirements for cryptocurrency inheritance exceed the capabilities of most non-technical heirs,” according to Egwabor. “Even with proper documentation, beneficiaries may struggle to understand wallet recovery procedures, private key management, or security best practices.” This lack of knowledge and technical errors can result in inheritance losses.
Best Practices for Estate Planners
Inventory and Access. Encourage clients to maintain a secure, up-to-date inventory of their digital assets. This should include:
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- A list of all digital assets and platforms
- Wallet types (hardware, software, custodial)
- Approximate values and storage locations
- Access credentials (stored securely and separately)
Legal Authority. Include a digital asset clause in estate planning documents that:
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- Defines digital assets broadly.
- Grants fiduciaries authority to access, manage, and transfer digital assets.
- References the Revised Uniform Fiduciary Access to Digital Assets Act in the California Probate Code (more below).
Confidentiality and Security. Avoid including sensitive access information directly in the estate plan. Instead, reference a secure location known to the fiduciary.
Tax Compliance. Consult with tax professionals to ensure proper valuation and reporting of digital assets for estate tax purposes.
Education and Collaboration. Work closely with clients’ financial advisors and digital asset custodians. Consider involving technical experts to assist fiduciaries unfamiliar with crypto platforms.
The Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) governs how fiduciaries—such as executors, trustees, conservators, and agents under a power of attorney—can access a person’s digital assets when that person dies or becomes incapacitated. It balances the need for fiduciaries to manage digital property (like online financial accounts, cloud storage, and social media) with the user’s privacy rights. The law allows access to digital assets if the user has explicitly authorized it in legal documents, but restricts access to the content of electronic communications unless specific consent is given. California adopted its own version of RUFADAA in 2016, incorporating the core principles of the model law with some state-specific modifications.
No Longer Fringe
Digital assets are no longer solely the instruments of speculators and tech hipsters. They are mainstream components of modern estates, particularly in California. Estate planners who proactively address these assets can protect their clients’ legacies and reduce the risk of litigation or loss. As always, clarity, documentation, and collaboration are your best tools.
Facing an Estate Dispute? We’re Here to Help
Failing to understand and plan for these evolving forms of assets can lead to confusion, lost value, and disputes. If you are an estate attorney or estate planner and think your clients may be headed for conflict, our experienced litigators are here to assist you in avoiding litigation or bringing it to a satisfactory conclusion.
Contact us today to discuss your case in a confidential consultation.
