This note is intended for notaries and their staff dealing with cryptoassets in an estate.
It covers the technical aspects only: identifying the holdings, the physical precautions, and a method of valuation. Questions of succession law and taxation fall within your own assessment and are not addressed here.
1. Manner of holding: platform or self-custody
The first matter to establish is how the assets are held, since everything that follows depends on it.
Held on a platform (Kraken, Bitvavo, Coinbase, Bitstamp and others). There is an identified counterparty, an account in the name of the deceased, a KYC identification and a procedure applicable on death. The position resembles that of an account held abroad. The notary can write to the platform, produce the death certificate and the certificate of inheritance, and obtain a statement of the holdings.
Held in self-custody. There is no counterparty, no service that can be addressed and no procedure. Access rests entirely on a recovery phrase, consisting of twelve or twenty-four ordinary words, generally written on paper or stamped into metal. Those words constitute the asset itself. In their absence, and without a backup, the holdings remain visible on the blockchain but become permanently inaccessible. No service provider, court or administrative authority has any means of remedying this.
Both manners of holding frequently occur within the same estate.
2. Indications that cryptoassets are present
In order of reliability:
- Bank transfers to or from a trading platform. The strongest indication, and visible on the account statements.
- A device the size of a USB stick or a small card reader, generally branded Ledger, Trezor, BitBox or Coldcard.
- A list of words, handwritten, printed or engraved on a metal plate, comprising twelve or twenty-four terms with no other context.
- Electronic correspondence from a trading platform, including routine sign-in notifications.
- An authentication application installed on the deceased's telephone.
- A tax return declaring accounts held abroad.
An unexplained transfer to a platform, including an old one, warrants investigation where no other indication is present.
3. Actions to avoid
The losses observed in practice generally occur in the days following discovery, in the course of steps taken in good faith.
Do not reset the devices, and do not allow a third party to do so. A device wiped while the recovery phrase remains missing results in the permanent loss of the holdings.
Do not enter the recovery phrase on a website or in an application. No legitimate service requests it. Any page inviting such entry transfers the holdings immediately.
Do not photograph the phrase, and do not store it in online storage, an email or a password manager. It must remain on its original medium.
Do not transfer any funds as a protective measure. A transfer is irreversible: there is no institution to approach and no operation capable of being reversed. Holdings left in a wallet are exposed to no risk through the passage of time.
Disregard unsolicited offers of recovery. Since death notices and estate records are public, third parties approach heirs offering, for a fee, to recover cryptoassets. A recovery phrase that has been lost cannot be reconstructed by anyone: such approaches constitute an attempted appropriation.
Do not infer from a device that no longer powers on that it is empty. The condition of the battery has no bearing on the holdings.
4. Safekeeping of items found
To be placed in the office safe or a bank safe deposit box:
- the devices, in the condition in which they were found, with no attempt at unlocking;
- any medium bearing a list of words;
- telephones, computers and tablets, not reset;
- handwritten notes and envelopes bearing instructions.
An inventory of the items found should be drawn up, without transcribing the terms of the recovery phrase into the file.
5. Valuation at the date of death
Cryptoassets are valued at the date of death, as are the other components of the estate. The difficulty is particular to this class of holdings: the markets operate continuously, seven days a week and without public holidays, so that no opening price and no closing price exists to which reference can be made. The price also differs between platforms, generally to a marginal degree.
In the absence of a statutory convention, one must be adopted, documented and applied uniformly across the file:
- Fix a reference time on the date of death, for example 00:00 UTC, and apply it to every line. A volume-weighted average across the twenty-four hours of that day is an equally defensible alternative, and is less exposed to intraday volatility.
- Use a single source for the whole declaration: a specified platform, or a published reference index.
- Place the evidence on file: a screenshot or timestamped export of the price adopted.
- State the quantity and unit separately from the amount in euros. A line reads "0.7421 BTC", not an amount on its own.
The question will be raised by the heirs: between the date of death and payment of the duties, the value may have moved considerably, upwards or downwards. The basis of valuation remains that of the date of death.
6. Entries in the estate declaration
For each position:
- the asset and the exact quantity;
- the unit value adopted, the source and the timestamp;
- the manner of holding: a platform identified by name, or self-custody;
- in the case of a platform, its identification and country of establishment.
7. Points to verify
These points fall within your own assessment. They are noted because they are frequently overlooked.
- The applicable rate depends on the region of the deceased's fiscal domicile. Rates differ between the Flemish Region, the Brussels-Capital Region and the Walloon Region, and are subject to regular amendment.
- Accounts opened with platforms established abroad may fall within the reporting obligations applicable to foreign accounts. As the position has evolved, the current state of the rules should be verified.
- Forced heirship applies to these assets as to others, which presupposes that they can be valued.
8. Absence of an access key
It may be necessary to inform the heirs of this situation. Where the recovery phrase has been lost and no backup was made, the holdings are permanently lost. They remain publicly visible on the blockchain, a circumstance that makes the loss harder to accept, without anyone being able to dispose of them.
One question remains for you to determine: the treatment in the declaration of an asset that is identifiable but inaccessible, and the value to be attributed to it.
Nakamoto.be assists with the technical aspects of estates containing cryptoassets, in support of the notary handling the file. We hold no keys, no funds and no assets, and we provide no legal or tax advice.
For a question relating to a current file: [email protected].
A technical document. It constitutes neither legal advice nor tax advice.
