Bitcoin (BTC) may be an asset less than 20 years old, but for investors viewing Bitcoin as a long-term asset, the important question is not only "how much was it bought for" or "when to sell" but also the question of what happens when the Bitcoin owner passes away — how will the accumulated assets be passed on to descendants?
Bitcoin differs from traditional assets in that ownership rights are not solely based on the account holder's name. In cases of self-custody, access to Bitcoin depends on critical information such as Private Keys, Seed Phrases, and Passphrases. Without prior inheritance planning, Bitcoin may exist on the Blockchain but be inaccessible to anyone.
Sirapob Nilbodi, also known as “Ajarn King,” Head of Bitcoin Education at Right Shift Company Limited, explained that the management of Bitcoin inheritance varies according to the custody method, each with its own advantages, risks, and procedures heirs must follow.
For investors who do not hold Bitcoin themselves but buy and store it on digital asset business platforms regulated by the Securities and Exchange Commission (SEC), when the account owner dies, heirs can proceed through legal processes to manage those assets.
Generally, this involves obtaining a court order to appoint an estate administrator, then submitting the court order along with relevant documents such as the death certificate and identification to the service provider to handle the deceased’s account assets according to each platform’s procedures.
The key point is that heirs should know where the deceased’s Bitcoin is held. Even though legal processes can be followed, if there is no information about the account or platform used, the assets may be overlooked.
Another option is investing through Bitcoin ETFs. If the units are held through the capital market system, inheritance management resembles that of other securities or investment units rather than transferring Private Keys.
Currently, Bitcoin ETFs in the Thai stock market are under SEC consultation processes, while some Thai investors can access foreign Bitcoin ETFs through providers offering cross-border securities trading.
In the event of the owner’s death, heirs must follow the service provider’s and relevant legal procedures. Details vary depending on asset type, country of registration, and involved providers. Therefore, it is advisable from the start to record which platform holds the assets and under which country’s law they fall.
For those who buy and store Bitcoin on foreign digital asset trading platforms, inheritance management can be more complex because each platform may have different policies regarding user death, including documentation, verification steps, fees, and legal processes.
Additionally, if the provider falls under the jurisdiction of another country, asset handling may involve the laws and procedures of that country. Thus, investors should document the platform used, as well as contact channels and steps heirs must follow to reach the provider.
The most critical case is self-custody, or holding Bitcoin personally.
The key difference is that no company or platform can directly verify heirs’ rights as with typical trading accounts, because access rights are tied to the keys controlling the wallet. Thus, the question is how to securely deliver access information to heirs without allowing others to take the Bitcoin prematurely. This issue has two important dimensions.
The first dimension is how to transfer access rights. Suppose the investor stores the Seed Phrase in a safe and informs descendants about its existence. This seems simple but carries risk because heirs with access before the owner’s death could immediately access the Bitcoin.
Conversely, if the Seed Phrase is entrusted entirely to another person, such as a lawyer, risks arise as that person might access the Bitcoin without waiting for the owner’s death, leading to the concept of splitting access rights.
One applicable method is Multisig, or Multi-signature Wallets. For example, creating a 2-of-3 Multisig Wallet means the wallet has 3 keys, but at least 2 keys are needed together to execute transactions.
Suppose the Bitcoin owner divides the keys into 3 sets stored in different locations or with different people. While alive, the owner controls Bitcoin under designed conditions. Upon death, heirs can use their key together with another designated key to access the assets.
Importantly, Multisig does not mean splitting the same Seed Phrase into parts but using multiple independent keys combined according to wallet rules. For holders of substantial assets, this reduces risks from loss, theft, or premature exposure of a single key set.
For investors desiring a more complex structure, there are services called Collaborative Multisig, which help organize Multisig wallets and may hold some keys under specific conditions.
The key idea is that the service provider cannot unilaterally take the owner’s Bitcoin, but upon defined events such as the owner’s death, the provider participates in delivering keys or executing planned procedures.
The trade-off is greater reliance on third parties, requiring consideration of trustworthiness, security, costs, and legal issues.
For technically knowledgeable users, Bitcoin spending conditions can be scripted. One concept is Dead Man's Switch, which changes access rights if no activity occurs within a defined period.
For example, if the owner’s key shows no movement for a set time, heirs can then use their keys to access the assets.
This approach's advantage is the owner need not immediately give heirs the main key, but it requires careful design as incorrect conditions or lack of backups may risk asset loss.
Another often overlooked problem is that even if heirs receive the keys, without knowledge of how to use Bitcoin, assets may still be lost.
Ajarn King noted some Bitcoin holders try to educate family members on basics, but over time family may not continue usage or learning, forgetting essential steps. One solution is to prepare an inheritance document in advance without including all secrets in one file.
This document should specify,
Especially, Seed Phrases and Passphrases should be treated as confidential and not shared unnecessarily. Conversely, information like Extended Public Key (Xpub), Wallet Descriptor, or Bitcoin balances may be designed for verification or wallet recovery in some cases, requiring clear understanding of disclosure levels. What must not happen is heirs posting Seed Phrases publicly on social media for help after the owner’s death, as this would immediately expose the Bitcoin to others.
9. Don’t forget inheritance tax even if Bitcoin is self-custodied
taxation. Storing Bitcoin in self-custody without intermediaries does not mean the asset is outside tax laws. According to Ajarn King,
if the net inheritance value heirs receive exceeds 100 million baht, including other assets and liabilities under relevant laws, the excess may be subject to inheritance tax at prescribed rates. Therefore, investors with significant Bitcoin holdings should plan documentation, asset valuation, and tax obligations ahead, not focusing solely on storing Private Keys.
Additionally, digital asset regulations are increasingly stringent, including measures related to the Travel Rule concerning transaction data sharing between providers. This undermines the notion that self-custody means no one knows you hold Bitcoin, so this should not be assumed in tax planning.
Checklist for passing Bitcoin to descendants without loss
01) Know where the Bitcoin is held,
If held through intermediaries, it is vital to inform heirs where assets are held and what to do. For self-custody, it is even more important to design a system allowing intended recipients to access assets at the right time while preventing unauthorized early access. Above all, complete Bitcoin inheritance involves transferring not just the “keys” but also knowledge, understanding, and asset management plans to successors.
Ultimately, Bitcoin may never disappear from the Blockchain, but if no one knows how to access it, it becomes an inheritance never reaching its intended heirs.
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