Florida Probate, Trust & Guardianship Litigation

How to Recover Bitcoin for an Estate

When someone passes away owning Bitcoin or another cryptocurrency, the recovery process can be difficult or impossible.  As a personal representative or executor of an estate, the first job is to locate, custody and protect the assets of the deceased.  Recovery of Bitcoin and other cryptocurrencies is an essential part of being a personal representative.

In order to locate and collect the Bitcoin of a deceased person, the basic facts about Bitcoin and how Bitcoin has been held over they years is necessary.  This is because Bitcoin has been held in a number of different forms over the years, including on brokerage exchanges, on cryptocurrency exchanges, and inside private wallets.  So the first step is to look for clues about how the Bitcoin was being held.

How Has Bitcoin Been Custodied Over the Years?

Exchange-Traded Security

The most recent form for holding bitcoin is as an exchange-traded security, the most popular one known as the Greyscale Bitcoin Trust, traded on the New York Stock Exchange, under the ticker symbol GBTC.  Greyscale is an Exchange Traded Fund (“ETF”), which simply holds a large number of Bitcoins.  The shares in the fund trade like any other stock.  Because GBTC can be purchased like any other stock in a brokerage account, it is the easiest and most convenient way in which to hold Bitcoin.  Other large Bitcoin ETF’s are as follows (as of April 2024).

ARKA ARK 21Shares Active Bitcoin Futures Strategy ETF
ARKB ARK 21Shares Bitcoin ETF
BETE ProShares Bitcoin & Ether Equal Weight Strategy ETF
BETH ProShares Bitcoin & Ether Market Cap Weight Strategy ETF
BITB Bitwise Bitcoin ETF Trust
BITC Bitwise Bitcoin Strategy Optimum Roll ETF
BITO ProShares Bitcoin Strategy ETF
BITW Bitwise 10 Crypto Index Fund
BITX 2x Bitcoin Strategy ETF
BRRR Valkyrie Bitcoin Fund
BTCO Invesco Galaxy Bitcoin ETF
BTCW WisdomTree Bitcoin Fund
BTF Valkyrie Bitcoin and Ether Strategy ETF
BTOP Bitwise Bitcoin and Ether Equal Weight Strategy ETF
DEFI Hashdex Bitcoin ETF
EZBC Franklin Bitcoin ETF
FBTC Fidelity Wise Origin Bitcoin Fund
GBTC Grayscale Bitcoin Trust
HODL VanEck Bitcoin Trust
IBIT IShares Bitcoin Trust Registered
STCE Schwab Crypto Thematic ETF
WGMI Valkyrie Bitcoin Miners ETF

Recovery of a Bitcoin ETF for an estate should operate exactly like any other security held in a brokerage account.  The Personal Representative of the Estate will need to supply Letters of Administration to the brokerage, and the brokerage should then turn over control of the brokerage account to the Personal Representative.  Selling a Bitcoin ETF for cash should be simple, and operates exactly like selling any other security in a brokerage account.

Cryptocurrency Exchange

Cryptocurrency exchanges have been the most popular way to hold cryptocurrencies.  Such exchanges operate very much like a brokerage account – the owner of the account should have a username and password.  And if the password is ever lost, the exchange should have a password recovery protocol.  Even without use of the password recovery protocol, any United States-based exchange will be required to honor the Letters of Administration of the Personal Representative and to follow court order.  Offshore exchanges will be more difficult to deal with if the password recovery tools cannot be used.

Whether or not the deceased had a cryptocurrency exchange account requires some sleuthing.  If access to the deceased’s email has been obtained, searches for the names of exchanges might be a good place to start.  Unfortunately, many of the earlier exchanges went bust because of wholesale theft from the exchange or from fraud.  Some of the exchanges went through (or are currently going through) bankruptcy or liquidation proceedings, so expanding the search for communications from persons associated with the bankruptcy could help.  Here is a partial list of exchanges, along with their status (as of April 2024).

Cryptocurrency Exchanges Still Operating

  • Binance
  • Coinbase
  • Bybit
  • OKX
  • Upbit
  • Kraken
  • KuCoin
  • Gate.io
  • Bitfinex
  • Bitstamp
  • Gemini
  • Crypto.com
  • Paybis
  • Bitpanda
  • BitMEX
  • Deribit
  • Liquid
  • Coincheck
  • Bitflyer
  • Bitso
  • Coinone
  • Luno
  • BitBay
  • Paxful
  • Bisq

Cryptocurrency Exchanges Under Administration or Bankruptcy

  • FTX: https://restructuring.ra.kroll.com/FTX/
  • Celsius Network: https://cases.stretto.com/celsius
  • Voyager Digital: https://www.investvoyager.com/
  • BlockFi: https://restructuring.ra.kroll.com/blockfi/
  • Three Arrows Capital: The claims process for Three Arrows Capital is being handled by the liquidators, Teneo. You can find more information on their website: https://www.teneo.com/
  • Genesis:  https://www.genesiscap.co/
  • Bittrex: https://www.bittrex.com/ 
  • Cryptopia: Address: The claims process for Cryptopia is being handled by the liquidators, Grant Thornton. You can find more information on their website: https://www.cryptopia.co.nz/
  • QuadrigaCX: The claims process for QuadrigaCX is being handled by the trustee, Ernst & Young. You can find more information on their website: https://www.ey.com/en_ca/quadrigacx
  • Mt. Gox:  The claims process for Mt. Gox is being handled by the trustee, Nobuaki Kobayashi. You can find more information on their website: https://www.mtgox.com/
  • Bitgrail: The claims process for Bitgrail is being handled by the liquidator, Bitgrail Exchange. You can find more information on their website: https://www.bitgrail.com/
  • Hodlnaut: https://www.ey.com/en_sg/hodlnaut
  • Blockchain Global/ACX: The claims process for Blockchain Global/ACX is being handled by the administrators, Pitcher Partners. You can find more information on their website: https://www.pitcher.com.au/
  • Mine Digital: https://www.svp.com.au/

If the Personal Representative believes that the deceased held assets on an exchange presently in bankruptcy, the Personal Representative should inquire as to whether the deceased filed a claim, and if not, should seek to file one if appropriate.

Cryptocurrency Exchanges That Have Ceased Operations

The following exchanges have shut down and liquidated.  If they were in bankruptcy or similar proceedings, those proceedings are likely over and no recovery is possible.  Of course, if the Estate is believed to have held assets on one of these exchanges, the Personal Representative should make further inquiries to determine whether any recovery is possible.  Also, if the deceased filed a claim for recovery, a check should be made to see whether that claim is considered valid but not yet paid out.

  • Youbit
  • BTC-e
  • Coinroom
  • BitMarket
  • Altsbit
  • Liqui
  • COSS
  • CoinExchange
  • BitZino
  • Bitcurex
  • Btc-e.nz
  • BTCBear
  • Coinomat
  • CryptoMarket
  • Crypto-Trade
  • CryptoBridge
  • Nova Exchange
  • TradeSatoshi
  • BitSpark
  • BitMex
  • CoinExchange.io
  • Cryptsy
  • Cryptonit
  • Cryptobridge
  • Cryptomate

Cryptocurrency Wallets

Originally, the only way in which to hold Bitcoin was in a wallet that the owner controlled.  This presented a number of issues, the main one being that cryptocurrency held inside of a wallet could not easily be sold, and adding new bitcoins to a wallet was not easy.  Holding, buying and selling Bitcoins was far easier on an exchange.  So the early exchanges were developed, to which early Bitcoin adopters flocked.  Unfortunately, many of the early exchanges failed, due to theft or fraud.  Most of the failed exchanges were outside of the United States, which allowed dodgy practices to proliferate.  The current class of United States-based exchanges, such as Coinbase, seem to have solved the theft, fraud and custody issues, making the need for private wallets somewhat obsolete.

If the deceased was believed to have been an early Bitcoin investor or was strongly concerned by security or privacy issues, the decreased may have a wallet filled with cryptocurrency.  Wallets come in four basic styles, but only the hardware wallet addresses safety and security concerns.  The other types of wallets had fairly limited adoption and are not in wide use today, given how secure United States-based exchanges are.  Nevertheless, in searching the deceased’s computer devices, searches for the names of the various wallet applications should be undertaken.

Desktop Wallet

A crypto desktop wallet is a software program that can be downloaded and installed on a computer. It allows the user to store, send, and receive cryptocurrencies. These wallets work by generating a unique private key, which is used to access the cryptocurrency and sign transactions. The private key is stored on the computer.

Here is a list of desktop wallet applications.  A search of all the deceased’s computer hardware should be undertaken to determine whether any of these applications are found.

  • Exodus
  • Electrum
  • Atomic Wallet
  • Bitcoin Core
  • Wasabi Wallet
  • Jaxx Liberty
  • Guarda Wallet
  • Coinomi
  • Armory
  • GreenAddress

Mobile Wallet

A mobile cryptocurrency wallet works just like a desktop wallet, but through an application loaded onto a smartphone.  If the deceased’s phone can be unlocked, a search should be made for the following applications that could hold the private keys to the cryptocurrency wallet.  Here is a list of the most popular mobile wallets.

  • Coinbase Wallet
  • MetaMask Crypto Wallet
  • Crypto.com DeFi Wallet
  • Exodus Crypto Wallet
  • Gemini Crypto Wallet
  • Ledger Crypto Wallet
  • Ellipal Titan Crypto Wallet
  • SafePal Crypto Wallet
  • Trust Wallet
  • Mycelium Bitcoin Wallet
  • Atomic Wallet
  • Guarda Wallet
  • Coinomi Wallet
  • Edge Wallet
  • BRD Wallet

Web-Based Wallet

Web-based crypto wallets are digital wallets that allow you to store, send, and receive cryptocurrencies through a web browser. They are also known as online wallets or hot wallets. These wallets are accessible from any device with an internet connection.  A search in the browser history and in a password manager should be conducted for the names of any of these web-based URL’s.

Here is a list of the most popular web-based wallets.

  • Coinbase Wallet
  • MetaMask Crypto Wallet
  • Crypto.com DeFi Wallet
  • Exodus Crypto Wallet
  • Ledger Crypto Wallet
  • Trust Wallet
  • XDEFI Wallet
  • MyEtherWallet
  • Guarda Wallet
  • Coinomi Wallet
  • Blockchain.com Wallet
  • Electrum Wallet
  • Jaxx Liberty Wallet
  • Edge Wallet
  • Atomic Wallet

Hardware Wallet

A crypto hardware wallet is a physical device that securely stores your cryptocurrency private keys offline, providing an extra layer of security against hacking and theft. These wallets are designed to keep private keys safe and accessible, even if your computer or smartphone is compromised.  In general, early Bitcoin enthusiasts and those highly concerned with security or privacy will have a hardware wallet.

Here’s how a crypto hardware wallet works:

Private Key Generation: When you set up a hardware wallet, it generates a unique private key for you. This key is generated using a random number generator and is stored securely on the device.
Transaction Signing: When you want to send cryptocurrency, you initiate the transaction on the hardware wallet. The device signs the transaction using your private key and then sends the signed transaction to the blockchain.
Offline Storage: The private key never leaves the hardware wallet, ensuring that it remains secure even if your computer or smartphone is hacked.
Recovery Phrase: In case you lose or damage your hardware wallet, you can recover your private key using a recovery phrase. This phrase is a set of random words that you are prompted to write down and store in a safe place when you set up your hardware wallet.

Hardware wallets are considered one of the most secure ways to store cryptocurrency, as they provide an additional layer of protection against hacking and theft. They are also easy to use and can be connected to a computer or smartphone via USB or Bluetooth.

The most popular brands of cryptocurrency hardware wallets are as follows:

  • Ledger
  • Trezor
  • Ellipal
  • SafePal
  • KeepKey
  • BitBox
  • CoolWallet
  • SecuX
  • Keystone

If you see a device with any of these brands on it, or that looks like the following, that device will be required to access the Bitcoin.  Finding one of these devices in the possessions of the deceased  should be considered a very good indicator that there is a trove of Bitcoin waiting to be found.  Also, any device that looks like a thumb drive could be operating as a private hardware wallet.  Therefore, thumb drives belonging to the deceased should never be discarded without checking each drive.

How To Access Cryptocurrency When the Password or Private Key is Not Known

An exhaustive list of how to look for or determine someone’s password is beyond the scope of this article.  With United States exchanges and brokerages, recovery of an account should operate like any other account.  For cryptocurrency wallets, the decentralized nature of the blockchain means that you are on you own.  There is no central administrator of Bitcoin to reset passwords or otherwise help you recover missing Bitcoin.

Cryptocurrency wallets have recovery phrases that allow recovery of the missing private key.  A recovery phrase is either 12 or 24 words.  If you come across a strange list or sentence with 12 or 24 words, you might be looking at the recovery phrase for a private wallet.  Safeguarding this information is crucial.  Before the deceased’s cryptocurrency is recovered, no data of any kind belonging to the deceased should be discarded, particularly scraps of paper that could hold missing recovery phrase information.

Expert Recovery of Missing Bitcoin or Other Cryptocurrency

There are experts to assist with the recovery of missing Bitcoin or other cryptocurrency.  Most charge a percentage of the recovery, typically 15% – 30%.  Others work on an hourly basis, typically $500 – $1,000 per hour.

How to Probate Bitcoin

Probating Bitcoin should work like any other asset.  The Personal Representative needs to locate, marshall and safeguard the Bitcoin, and then report the value of the Bitcoin on the estate inventory.  If the Bitcoin is needed to pay creditors, the Bitcoin would need to be sold for cash and creditors paid.  If not needed for creditors, any direction in the will regarding the Bitcoin should be followed.  The Bitcoin can be distributed in kind to beneficiaries or sold for cash, depending on the terms of the will and the preference of the executor and beneficiaries.

We recommend that, after the death of the deceased, the personal representative of executor move the Bitcoin or other cryptocurrency onto a United States-based exchange, for transparency purposes and to facilitate transactions in the Bitcoin, such as distributions in kind or selling the Bitcoin.  A personal representative must be able to “show their work,” to avoid any accusations of improprieties.


Can Bitcoin be Held in a Trust?

Yes, Bitcoin can be held within a trust.  Administration of a trust that holds Bitcoin should operate like any other asset inside a trust.  We recommend that, after the death of the settlor / trustee, the new trustee move the Bitcoin or other cryptocurrency onto a United States-based exchange, for transparency purposes and to facilitate transactions in the Bitcoin.

Oral Argument at 5th District Court of Appeals

Jeffrey Skatoff

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(561) 842-4868


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