Family members are rarely fully informed about a person’s assets in general, but this problem is especially acute for difficult to track assets. Cryptocurrency is one such asset that has gained popularity in recent years. According to industry estimates, around 15 million Indians actively invest in digital currencies such as bitcoin, ether, and dogecoin. The nominee option on crypto exchanges is one of the simplest ways to ensure that your family has access to your possessions.

ZebPay provides this service by mail, allowing customers to provide information such as the nominee’s name, phone number, address, and PAN number, among other things. The fiat and crypto monies are transferred to the nominee’s account after the customer passes away. However, not all crypto exchanges in India now provide this service, and investors have encouraged them to do so.

Even though we do not yet have a nomination option, our support team is well-equipped to deal with such situations. We’ve dealt with similar problems before. In such circumstances, we assist the deceased person’s family members in obtaining custody of their assets “WazirX’s CEO and creator, Nischal Shetty, stated that the nominee option would be added to the platform soon. BuyUcoin, another cryptocurrency exchange, is working on a nominee as well as a nudge option.

“Once this function is available, customers who have not yet designated a nominee will be prompted to do so every time they log in,” says the company, “BuyUcoin’s CEO, Shivam Thakral, said. In the meanwhile, a deceased person’s family member might submit a request to the exchange.

Like other asset classes such as bank accounts, a nominee is a person who has custody of the assets and protects them while they are in transit. According to experts, the actual legal title to the asset (in this example, crypto) will belong to the person specified in a Will or, depending on the religion, intestacy law.

As a result, anyone choosing the nominee option should make sure that the Will names the same person as the legal heir to the crypto assets.

“A Will aids in the correct accounting of digital assets and the directions for family members to access them. “If you don’t make a Will, everything you possess will be distributed according to the law, which may or may not be the way you want it,” said Nitin Rao, CEO of InCred Wealth.

A Will for Crypto Assets

Because cryptocurrencies are not standard assets like stocks or bank accounts, their handling laws are still in their infancy in India.

“Since the Supreme Court struck down the 2018 RBI circular, cryptocurrencies appear to be in a ‘grey area. Crypto holdings would be deemed legal assets in India until the government says otherwise, and such assets can be included in a testator’s Last Will,” said Rishabh Shroff, partner at Cyril Amarchand Mangaldas. A person who has drafted a Will is known as a testator.

Because cryptocurrencies are not standard assets like stocks or bank accounts, their handling laws are still in their infancy in India.

“Since the Supreme Court struck down the 2018 RBI circular, cryptocurrencies appear to be in a grey area. Crypto holdings would be deemed legal assets in India until the government says otherwise, and such assets can be included in a testator’s Last Will,” said Rishabh Shroff, partner at Cyril Amarchand Mangaldas. A person who has drafted a Will is known as a testator.

Ideas to Consider  

Individuals can own, gift, and inherit bitcoins because they are similar to any other property.

Because the regulations governing cryptocurrencies in India are still uncertain, a person’s Will should include a list of all cryptocurrencies he or she owns and the digital wallets used to make such investments.

“Because cryptocurrencies are stored on blockchain technology, the testator may include a memorandum to the Will including the passwords to such digital wallets, and a copy of the memorandum could be given to Will’s executor. “In the event of a Will dispute, this would help ensure that passwords and personal identification details are not made public,” Shroff explained.

Many people store their bitcoins on physical hardware, which acts as a master key for their crypto wallets. If these hardware wallets are lost or stolen, the Bitcoin is permanently lost. As a result, this hardware wallet’s physical custody and legal ownership are critical issues that should be addressed carefully in a Will.

Legal Place

Experts are waiting for more clarifications and data on the legal position of cryptocurrencies from the Reserve Bank of India, the Union government, and the courts.

The Union administration intends to submit a crypto bill that would clarify the legal position of cryptocurrencies.

Indian investors may hold crypto assets outside of the country. Resultantly, there is an additional layer of cross-border planning to be completed, including exposure to offshore taxes and reporting obligations.

While making a Will is simple, seeking skilled professional assistance is essential to ensure that the document is not open to interpretation and that all Indian legislation and laws regarding virtual currency are followed.

Difference Between Public Keys and Private Keys 

A cryptocurrency is a decentralized, digitally encrypted currency that is not tied to or regulated by any government or central bank. The terms “public” and “private” keys describe these two types of keys.

When you store cryptocurrencies in an offline wallet, such as a hardware wallet or a paper wallet, these terms take on new meaning. If you store cryptocurrency on an exchange, the exchange has access to your private key. This minimizes the chance of losing Bitcoin due to a loss of the private key, but it also increases the danger of being hacked.

A private key is a vast and unpredictably generated number. It functions as a password and determines the asset’s ownership. Crypto wallets usually generate a private key for their customers. Having remote access is practically the same as owning crypto. A public key is an address that anybody can see and that another person can use to transfer your crypto assets.