Digital Assets and Fiduciary Oversight

When Your Greatest Asset is a Password Nobody Can Find

Picture this: A family is gathering after the unexpected passing of their 58-year-old patriarch – a tech-savvy entrepreneur who had, over the past decade or so, amassed a very meaningful portfolio of cryptocurrency. He had mentioned it at Thanksgiving dinner more than once, usually right before someone changed the subject to football. Fast forward a few months and his personal representative is staring at a laptop, a crumpled piece of paper with a bunch of words on it and three adult children asking a very logical question: “Where’s the money?”

As it turns out, it was locked behind a private key that went to the grave with him. Gone forever was an estimated $500,000 in digital assets! Not because the market crashed, but instead because nobody planned for it.

He had a will, trust, a solid estate plan and a trusted advisor he had worked with for fifteen years. He just never mentioned the cryptocurrency.

As Fiduciaries, our responsibility has always been to act in the best interest of those we serve. In 2026, that responsibility now firmly includes the digital world.

The Digital Asset Landscape Has Changed – Fast

Digital assets are no longer a fringe phenomenon. As of 2026, an estimated 14% of the U.S. adult population own some form of cryptocurrency, which doesn’t account for the broader universe of digital assets, including NFTs (non-fungible tokens), tokenized real estate, digital brokerage accounts, online business equity, domain names, loyalty point portfolios and even valuable in-game assets where it’s rumored that individual gamers may hold in-game inventories worth more than their 401(k) balances.

What Exactly Is a “Digital Asset” in This Context?

For estate and fiduciary purposes, digital assets fall into a few broad categories:

• Financial Digital Assets – Cryptocurrency (Bitcoin, Ethereum, Etc.), Digital Securities, tokenized investments, peer-to-peer lending accounts and digital payment accounts such as PayPal or Venmo.
• Business & Income Producing Digital Assets – Monetized social media accounts, websites generating ad revenue, e-commerce stores, intellectual property registered digitally and software licenses. A YouTube channel with 500,000 subscribers can generate thousands of dollars monthly, which is real value to an estate or a beneficiary.
• Access Dependent Assets – Online Bank accounts, brokerage platforms and digital wallets where underlying assets exist in digital form, but access requires authentication.
• Sentimental or Personal Digital Property – Photos, videos, emails and personal documents stored in the cloud. Although these may not carry monetary value, the sentimental value is significant for loved ones.

The Expanding Responsibility of Fiduciaries

Although fiduciary law is evolving to adapt to advances in technology, it has not entirely kept pace with it. The Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) has been adopted by most U.S. states and provides the legal framework for fiduciaries to access digital assets; however, only when properly authorized in advance through legal documents or a platform’s own tools.

For a fiduciary this creates a two-part exercise: first, the fiduciary must identify and account for all the digital assets as part of comprehensive planning; and second, ensure the legal authority to access and ultimately manage those assets is established. Without both, the fiduciary may find themselves legally, and for all intents and purposes – locked out.

Key Consideration: Authorization must be established before it is needed. Waiting for death or incapacity to address digital assets is almost too late.

Useful Steps for Fiduciaries Today

Whether you are advising clients, serving as a professional trustee, or helping a family member get their affairs in order, the following steps represent the sound approach for digital assets.

1. Digital Asset Inventory: Work with the individual to create a comprehensive, and updated list of all digital accounts, assets and access credentials. This list should be stored securely – a fireproof safe, a digital vault, and/or with a trusted attorney/advisor and be sure to review and update the list at least annually.
2. Proper Legal Authorization: Review all Estate Planning Documents – wills, trusts and durable power of attorney – to confirm they include explicit digital asset access language consistent with RUFADAA.
3. Platform Tools for Designations: Many platforms – including Google, Facebook and major cryptocurrency exchanges – allow users to designate legacy contacts or beneficiaries directly on platform. Similarly to retirement accounts, these designations operate independently from estate documents and allow for immediate access. Completing these designations is a critical part of their overall planning.
4. Cryptocurrency Requires Special Care: Cryptocurrency held in self-custody (cold wallet) requires recovery phrase documentation. There is no password to reset, bank to call, or court order that can unlock a wallet without a private key. A client or family member holding meaningful cryptocurrency must document their recovery phrase in a secure, accessible location – and their fiduciary must know where to find it.
5. Digital Asset Agenda Item: For professional and corporate fiduciaries, digital asset discovery should be part of every estate administration checklist and every relationship review meeting. The landscape changes quickly, and the client’s exposure to digital assets two years ago may look quite different from today.

The Bottom Line

The story at the beginning of this article is not hypothetical. Scenarios like it are playing out in probate courts and family conversations across the country every day. It is estimated that billions of dollars in digital assets are permanently inaccessible due to the failure to properly plan.

As fiduciaries – whether personal or professional – we can help prevent that outcome for families and individuals who have placed their trust in us. The tools exist and the legal framework is largely in place. All we have to do is ask the question: “What digital assets do you have, and does someone know how to find then?”

Asking that one question consistently and followed up with proper planning, may be more valuable than the investment strategy implemented for them this year.