If you own a bank account then at the time of opening the account you are asked to provide the name of kin. In case the account holder dies then the funds lying into the account of the deceased are given to the kin. But what happens if a person dies who owns cryptocurrencies, assets or even NFTs. Is the digital wallet is transferrable or whether the wealth belonging to the deceased is given to the legal heirs?
Bitcoin’s value is surging and in the past two years it has increased enormously i.e. 900%. Before two years, the value of Bitcoin was about US$ 3,000 but due to its global adoption, it is now around US$ 60,000. Those who had bought Bitcoins at US$ 3,000 are now holding value of US$ 57,000 as profits. But if they ever loses the passcodes to their digital wallets, then there is no way they can ever acquire access to their wallets. It may seem odd but this is the truth that you cannot claim your Bitcoins if one has happened to forget his password.
There are only a handful of attempts provided to the crypto owner to gain access to his or her digital wallet. When these attempts are over, the account becomes permanently closed granting no access to the owner nor to the legal heirs.
Similarly, currently there is no mechanism of claiming back lost cryptocurrencies nor even they are transferable upon owner’s death. So whatever the person had owned before the death, is lost upon the death. Neither the owner’s legal heirs can claim inheritance rights over the crypto assets belonging to the deceased. Nor even the crypto trading platform who was rendering custodial services can use crypto funds of a deceased.
The access is granted to those persons only who have the passcodes, whether they are owners or not. Crypto system recognizes the owner as an “accessor” and access is granted only upon providing of required access key.
Interestingly each passcode for crypto wallet is comprised over 64 characters which could be letters, numbers and special characters.
There are many recorded instances where the owners had lost the passwords of their digital wallets. Resultantly, they lost what they had kept in their wallets and until the world ends, their accounts will remain unhindered.
When Bitcoin was invented, many people had overbought Bitcoins for future and rightly so. But when they tried to access their accounts when Bitcoin’s value gone past US$ 50,000, the found out that they’ve forgotten the passwords. All their efforts went in vain because they couldn’t access their accounts and apparently could not sell the coins.
So the most important thing for crypto owner is to make sure that he or she ensures the safety of passwords. Those who want to make their assets to be transferred upon their deaths, have to share the password with their loved ones. Otherwise all will be gone.