Incorporating Crypto into Your Estate Plan

Camden Law - Incorporating Crypto into Your Estate Plan

Estate planning and cryptocurrency systems are like oil and water; they don’t mix. That’s because cryptocurrency is a new asset class that most people do not understand, including many lawyers and financial advisors.

However, with the recent surge in interest and news coverage of Bitcoin and other digital currencies, more people are asking questions about how to include crypto in their estate planning.

The first step is to understand what cryptocurrency is and how it works. Cryptocurrency is a digital or computer-generated money exchange that employs cryptography as a security measure. Cryptocurrencies are not subject to government or financial institution control, so prices can significantly differ in value at any time.

In 2009, the bitcoin cryptocurrency was created as the first of its kind. Since then, other cryptocurrencies like Ethereum, Litecoin, and Monero have become increasingly popular.

Cryptocurrencies are stored on digital wallets like Coinbase and can be used to purchase goods and services or trade them on cryptocurrency exchanges. Cryptocurrencies are often traded on decentralized exchanges, meaning no central authority regulates the market.

Investing in cryptocurrency is speculative and risky but can also be incredibly lucrative. For this reason, it’s essential to consider how you would like to handle your crypto assets in the event of your death.

Regarding estate planning, there are a few key things to remember. First, cryptocurrency is an asset that you can pass on to heirs. Second, cryptocurrency is subject to estate and gift taxes. And finally, it’s crucial to have a plan in place in case of loss or theft of cryptocurrency.

When incorporating crypto into your estate plan, the best thing to do is consult with a lawyer or financial advisor who is familiar with the asset class. They can help you figure out the best way to structure your holdings in the event of your death.

If you have questions about incorporating cryptocurrency into your estate plan, please contact Camden Law at 630-568-6656. Our experienced lawyers serve our Chicago community in Downers Grove, Naperville, Hinsdale, Oak Brook, and surrounding areas with these complex issues.

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Downers Grove, IL 60515

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