Crypto in your will: how Queenslanders can pass on digital assets without losing them

Crypto is property — the law is not the hard part

In Australia, cryptocurrency is treated as property. It can be owned, gifted, bequeathed and inherited, and there is no legal barrier to leaving it under a will made under the Succession Act 1981 (Qld). The ATO treats crypto assets as CGT assets rather than currency.

What makes crypto different is not its legal character but how it is held, accessed and transferred. Ownership is proved by control of a private key or seed phrase. There is no central registry, no branch, no identity check and no reset-password link. Whoever holds the key holds the asset — and nobody else can recover it.

The four practical risks of not planning

Each of these turns up in real estates, and each is avoidable with an hour of planning.

• Permanent loss. A personal representative in Queensland must collect and administer the estate and account to beneficiaries. None of that helps if the keys died with the testator: the asset is not frozen or delayed, it is irrecoverable.
• The discovery problem. Nothing on a bank statement necessarily reveals a hardware wallet in a drawer, an offshore exchange account or a staking position. An executor who distributes without finding the crypto has under-administered the estate.
• The access and authority problem. Exchanges impose their own terms of service, identity verification and probate requirements, and most will want a sealed grant from the Supreme Court of Queensland. Offshore platforms raise questions of jurisdiction. Informally passing seed phrases around, or logging in as the deceased, can engage privacy obligations and computer-access offences.
• Volatility and family provision claims. Crypto can move 30% in a week. An executor who takes months to gain access, or who leaves a large holding exposed, faces genuine questions about whether estate value was preserved — and selling at the wrong moment invites the opposite criticism. Express directions in the will are the cleanest answer.

Say it expressly, but keep the keys out

Deal with digital assets explicitly — but never put a seed phrase, private key, password or PIN in the will itself. Once probate is granted the will becomes a public court document, and a broad class of people is entitled to inspect and copy the will even before then. Anyone who reads the key can take the asset, with no recourse.

The correct structure separates three things.

• The gift — in the will: who receives the crypto, in what shares, and what happens if that person dies first.
• The powers — in the will: express authority for your executor to access, hold, transfer, convert, sell or distribute crypto assets and digital accounts; to engage technical and tax specialists at estate cost; and protection from liability for market movements where they act in good faith.
• The information — outside the will: a secure, regularly updated asset register and access memorandum, referred to but not reproduced in the will.

Build the access memorandum properly

The memorandum is the document that actually saves the asset. For each holding it should record the asset; where and how it is held (exchange, hot wallet, hardware wallet, multi-signature arrangement); wallet or account identifiers; the step-by-step access process; the location of hardware devices and any seed-phrase backup; and 2FA recovery arrangements. It should also record acquisition dates and cost base, because your beneficiaries will need them for tax.

Store it where it survives you but cannot be casually read: a sealed packet in your solicitor's safe custody, a bank safe custody facility, an enterprise password manager with a documented emergency-access process, or a split arrangement where no single person holds the whole secret.

Then diarise a review whenever you change wallets, exchanges or devices. A memorandum three wallets out of date is worse than none, because it creates false confidence.

Choose the right executor — or the right support for them

Technical incompetence in an executor is one of the most common causes of loss. You do not need a crypto-native executor, but you do need either an executor who can follow a written process, or express power for them to retain a specialist. Where holdings are substantial, a co-executor with technical capability, or a named adviser in the memorandum, is worth serious thought.

Give directions on what should happen to the holding

Volatile assets deserve instructions. Options we commonly draft include liquidating promptly and distributing cash; transferring in specie to a named beneficiary; a discretion to hold for a defined period; or a hybrid, with liquidation as the default unless a beneficiary elects to take in specie. Silence leaves your executor exposed whichever way the market moves.

Plan for incapacity, and check the will is the right vehicle

Death is not the only trigger. If you lose capacity, your attorney under an enduring power of attorney may need to deal with your crypto for your benefit — and faces exactly the same access problem. Your enduring power of attorney and your financial records should be prepared with digital assets in mind, not just your will.

Not all crypto should pass under a will. Where holdings are large or held for a family group, a testamentary discretionary trust can provide asset protection and tax flexibility. Where crypto is held in an SMSF, succession is governed by the fund's trust deed, the binding death benefit nomination and superannuation law — not your will — and must be aligned with the estate plan. Business-held crypto raises its own questions about company and trust control succession.

Tax: what your beneficiaries need to know

Australia has no inheritance tax or death duty, and Queensland imposes no death duty. Under Division 128 of the Income Tax Assessment Act 1997 (Cth), a capital gain or loss on an asset owned at death is generally disregarded where the asset passes to your legal personal representative or to a beneficiary, and again when it passes from the executor to the beneficiary. In effect the gain rolls over, and CGT is triggered later, when the beneficiary sells, swaps or otherwise disposes of the crypto.

• Records are part of the inheritance. The beneficiary inherits the cost base history, so preserve exchange statements, wallet histories and any crypto tax software account.
• Watch the exceptions. Where an asset passes to a tax-advantaged entity or a foreign resident beneficiary, the rollover may not apply and a CGT event can be taken to happen at death — an issue for families with children living overseas, and for charitable gifts of crypto.
• In-estate dealings are not neutral. If your executor converts crypto to cash, that disposal has its own CGT consequences for the estate, and even a network fee deducted on transfer can be a disposal.

A checklist for crypto holders

If you hold cryptocurrency, the single most valuable hour you will spend on it is the one where you make it findable and transferable by someone else.

• Inventory every holding: exchanges, wallets, NFTs, staking and DeFi positions, and any linked fiat balances.
• Update your will to deal with digital assets expressly, with proper executor powers.
• Prepare a secure access memorandum — never keys in the will.
• Consolidate and simplify custody where you can. Fewer wallets, fewer failure points.
• Test the instructions: could a competent person follow them, cold, without you?
• Keep cost base records with the memorandum.
• Align your enduring power of attorney and any SMSF documents.
• Review after every change of device, exchange or wallet, and at least every two years.

How Coastside Law can help

From our Golden Beach and Scarborough offices we prepare estate plans that treat crypto as a real asset class rather than an afterthought: tailored Queensland wills and executor powers, secure access memoranda, testamentary trust structuring where appropriate, enduring powers of attorney, SMSF and business alignment, and support for executors already administering an estate that includes digital assets.

Call us on 0488 340 853 to review your estate plan.

Crypto and digital assets in Queensland wills — common questions