Crypto is Coming
By now you have probably heard about cryptocurrencies such as Bitcoin or Ethereum, and perhaps you have invested in them too. Regardless if you are a crypto expert, or outright against cryptocurrency, it’s important to understand how to plan for owning crypto assets as they gain mainstream traction.
Planning for digital assets has some similarities to planning for traditional assets. Protecting the assets from creditors and lawsuits, planning for retirement, and choosing who receives the assets when you die are the most crucial considerations when it comes to planning for digital assets. However, this new wave of crypto assets has added additional layers to traditional planning which need to be addressed.
Crypto Asset Varieties
Crypto assets are an emerging new class of assets which require additional considerations when planning for the future. The primary consideration involves understanding the different types of crypto assets.
Crypto assets are all derived from coins and tokens which exist on a blockchain. These coins and tokens are then distinguished by their different use cases. The most common types of crypto asset functionalities include their use as a currency to purchase items, for utility within crypto applications, and even as NFTs to prove ownership of a digital file.
As more crypto assets are developed, each asset type needs to have a definitive planning strategy in place.
Planning for Crypto Assets
The most important aspect of planning for crypto assets involves the storage of the assets. Crypto assets exist across the digital landscape, and they can be stored in both the digital and physical world. Choosing which storage option(s) is a crucial security measure when creating a plan for digital assets.
Another consideration involves the accessibility of crypto assets during your incapacity and after death. Crypto is commonly stored on exchanges, digital wallets, or hardware wallets. The only person who typically has access to these crypto accounts and wallets is the asset owner. This is why it is vital to plan ahead for someone else to access your crypto assets in case of an emergency.
There are endless strategies to planning for crypto assets. The best choice you can make it to start planning before it’s too late. Please contact our firm and speak with an experienced asset protection attorney so your crypto assets are planned for.