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Digital assets and cryptocurrencies can be included in wills for inheritance

Digital assets such as cryptocurrencies now have greater legal protection and can be included in a person’s will for inheritance purposes.

The stronger legal protection is provided by the Property (Digital Assets etc) Act, which received the Royal Assent in December.

It confirmed that digital assets like crypto tokens can be recognised as personal property.
Digital asset is an extremely broad term, encompassing a variety of things such as digital files, digital records, email accounts, digital carbon credits, cryptoassets and non-fungible tokens (NFTs).

Historically, the law has recognised two categories of property: “things in possession” such as gold, cars, mobile phones and “things in action”, which are legal rights, for example, debts and shares. This new law allows for the development of a further category to allow for certain digital assets to have personal property status while recognising their unique characteristics.

This means that as well as providing greater protection against scams, digital assets like cryptocurrency can be passed down through inheritance and recovered by creditors during bankruptcy, just like traditional assets.

With cryptocurrency fraud rising, owners also have clearer legal rights if their assets are stolen.
The Minister for Courts and Legal Services, Sarah Sackman, said: “By clarifying the status of digital assets, we remove uncertainty and simplify disputes.”

Please contact us if you would like more information about the issues raised in this article or any aspect of wills and probate.