Digital assets significantly impact estate planning, particularly in terms of access, management, and valuation of digital assets after death. Here are a few things to keep in mind:
- Access to Digital Assets: Under the Uniform Fiduciary Access to Digital Assets Act, a custodian must disclose a catalogue of electronic communications and digital assets to the personal representative of a deceased user’s estate, provided certain conditions are met. These conditions include a written request, a certified copy of the death certificate, and a certified copy of the letter of appointment of the representative, among other possible requirements. This statute ensures that digital assets can be accessed and managed by the estate’s personal representative, which is crucial for comprehensive estate planning.
- Management and Conversion of Digital Assets: Regulations require service providers to have sufficient financial backing and to convert virtual currency to fiat currency within two business days. They must also comply with various financial regulations, including those related to anti-money laundering and know-your-customer requirements. This ensures that digital assets are managed securely and efficiently, which is essential for maintaining the value of the estate.
- Ownership and Classification of Digital Assets: Digital securities are considered intangible personal property and are treated as securities and investment property under relevant commercial codes. Ownership can be demonstrated through control, and the rights to own digital assets are protected. This classification affects how digital assets are handled in estate planning, particularly in terms of their transfer and valuation.