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Got Crypto Currency? Get a Will.

As 2017 nears an end, there has been one strong theme in the world of financial markets and wealth accumulation: the rise of Bitcoin and crypto currency. Generation Y are fast acquiring crypto currency such as Bitcoin as an investment for the future, with Generation X reluctantly following, both seeing huge profits over a very short period of time. In the history of finance, there has never been anything like it in both terms of the product and the short term swings.

If you’re reading this, you probably know how crypto currency works in terms of privacy and security. I.e. your virtual wallet’s private keys; a very simple, yet currently unhackable string of digits which gives only the key holder access to the account. So what happens if you lose this key? Easy – you lose your money, never to be retrieved.

Given the substantial amount of money which could be held in these private keys, it is important to create backups and store them in the event you die or become incapacitated. If you are the only one with knowledge of your crypto currency holdings and private keys, if something happens to you, the money will be lost, never to be retrieved.

If you have substantial holdings, we strongly recommend putting a printed copy of the private key, or a hardware wallet in a private bank safety deposit box or a safe of your own. If you have a spouse, tell him or her what to do and how to access it in the event of a tragedy. No spouse? Tell your parents. No parents? Tell your most trusted loved one.

You should also consider making a Will. But don’t put any private keys in it – because you usually give copies of your will out to people and it may be seen by even more people as it goes through the probate process. You don’t want anyone else’s eyes on your private keys. It is however important, and safe to reference that you own crypto currency in your Will.

It’s easy to shrug off and think “it won’t happen to me” but unfortunately in life, tragedy can strike at any time. It is best to be prepared for the worst.

Don’t risk losing your funds forever. 

This commentary is published by Roche Legal for general information purposes only and should not be relied on as specific advice. The content relates to Queensland law only and is subject to change over time. You should seek legal advice for any question, or for any specific situation or proposal, before making any decision.