Dealing With Digital Assets On Death: Who Owns Them? Who Can Access Them? What Can Be Done To Protect Them?

Table of Contents

1. Digital Assets – Prologue
2. Defining and Categorizing: Assets vs. Accounts
3. Currency Accounts
4. Virtual Property Accounts
5. Social Media Accounts
6. The Law in Canada
7. Barriers to Access: Terms of Service & User Agreements
8. Estate Planning Considerations

Digital Assets – Prologue

Bitcoin Example:

• Of a capped total of 21 m. Bitcoins, 18 m. have been "mined"
• Some sources estimate that as many as 3 m. bitcoins (~$38 billion) are irretrievable
• Due to:
• • Lost retrieval codes ("private keys")
  • Lost USB's where the only records are stored
  • Owner death without leaving the private keys accessible to executors or next of kin

Death of a CEO

• In December 2018, Gerald Cotten, CEO of QuadrigaCX, Canada's largest cryptocurrency exchange died suddenly at age 30
• Mr. Cotten was the only person who had passwords to ~115,000 customers' digital wallets
• Approximately C$140m in digital currency held in safe keeping was deemed inaccessible
• Auditors found irregularities and managed to retrieve C$33 m. in missing funds
• RCMP asked to exhume the body (Dec. 2019)

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.