What Happens to Crypto and Digital Wealth When Someone Dies in the UK

When someone dies, their family usually knows to look for a will, contact the bank, and notify HMRC. But what about the cryptocurrency sitting in a hardware wallet? The PayPal balance? The domain names generating passive income? As more of our wealth moves online, probate is becoming far more complicated than it used to be. For families dealing with digital-heavy estates, particularly in London where tech professionals and digital entrepreneurs are concentrated, getting professional probate assistance early can prevent thousands of pounds in lost assets.

The scale of the problem is growing. The UK’s Financial Conduct Authority estimates that around 12% of UK adults now hold some form of cryptoasset. Many of these holders have not told anyone how to access their holdings after death. Unlike a bank account, there is no central register of crypto wallets, and no institution you can write to with a death certificate requesting access. If the private keys or seed phrases die with the owner, those assets can become permanently irretrievable.

The Law Has Finally Caught Up (Partly)

The Property (Digital Assets etc) Act 2025, which came into force on 2 December 2025, was a significant step forward. For the first time, English law formally recognises cryptoassets, NFTs, and other digital tokens as objects of personal property rights. Before this Act, crypto occupied a legal grey area. Courts had treated it as property on a case-by-case basis, but there was no statutory confirmation.

What does this mean in practice? It means digital assets can now be included in a will with greater legal certainty. Executors have a clearer legal basis for claiming ownership of the deceased’s crypto on behalf of the estate. And disputes over digital assets can be resolved using the same property law principles that apply to physical belongings.

But the Act solves the legal question, not the practical one. Recognising that crypto is property does not help an executor who cannot find the wallet or does not know the password.

The Access Problem

This is where digital estates differ in a basic way from traditional ones. When someone dies holding shares in an ISA, the executor applies for a grant of probate (currently £300 for estates over £5,000 in England and Wales), presents it to the provider, and the assets are transferred or sold. The process is bureaucratic but straightforward.

With crypto held in a self-custody wallet, there is no provider to contact. The assets are controlled entirely by whoever holds the private key, a long string of characters that functions as both password and proof of ownership. If that key was stored only in the deceased’s memory, or on a device that has been wiped or discarded, the assets are gone. Not frozen, not locked. Gone permanently.

Even crypto held on exchanges like Coinbase or Binance presents challenges. These platforms have their own verification and inheritance procedures, which vary by provider and can take months. Some require a grant of probate, others require additional documentation, and navigating customer service departments based overseas adds another layer of difficulty.

What Executors Need to Know

If you have been named as an executor for someone who held digital assets, there are several things to be aware of.

First, digital assets must be declared to HMRC as part of the estate. Crypto is subject to inheritance tax at the standard 40% rate above the nil-rate band (£325,000 per person, frozen until at least April 2030). The residence nil-rate band of £175,000 applies only to property passed to direct descendants, so it will not help with a crypto portfolio.

Second, valuation can be complex. Crypto prices are volatile, and HMRC expects assets to be valued at the date of death. For less common tokens, establishing a fair market value may require specialist input.

Third, you are personally liable as an executor. If you distribute the estate without properly accounting for digital assets and a tax liability later emerges, HMRC can pursue you individually. This is one of the strongest reasons to seek professional support rather than attempting to administer a complex estate alone.

Planning Ahead Makes All the Difference

The simplest way to prevent digital assets from being lost at death is to plan ahead. That does not mean sharing passwords openly, which creates security risks during your lifetime. It means creating a secure record of what you hold and where, and ensuring a trusted person knows how to access that record.

A digital asset register should include the type and approximate value of each holding, the platform or wallet where it is stored, and instructions for accessing it. This can be stored with your will, in a sealed letter left with your solicitor, or in a secure digital vault.

For families already dealing with a bereavement, the priority is to act quickly. Check the deceased’s devices, email accounts, and any password managers for evidence of digital holdings. Look for confirmation emails from exchanges, authenticator apps on their phone, or hardware wallets among their possessions. The intersection of technology and bereavement is uncomfortable, but ignoring it can mean losing significant wealth. As digital assets become a larger share of personal wealth in the UK, the families who plan for this will be the ones who actually inherit it.