If you or a loved one has been diagnosed with a terminal illness or are…
Don’t Leave Your Loved Ones in The Dark: Creating a Plan for Your Loved Ones & Trustees
On December 9, 2021, Gerald Cotten, CEO of QuadrigaCX, died unexpectedly at the age of 30 due to complications from Crohn’s disease. He was in India at the time working to open an orphanage for children to need. Adding major insult to this tragic event, Cotton failed to share his encrypted laptop’s password with a loved one or trustee and thus inadvertently caused $190 million in customer deposits to vanish when he passed.
Yes, you read that right. QuadrigaCX is a company that operates by having users deposit funds into an account and then trade various cryptocurrencies with others who use the platform. Within the company’s database, currency is transferred between hot wallets (coins in the server) and cold wallets (coins offline), and Cotten alone managed this task. When he died, funds contained in the cold wallets disappeared with him as no one else had access to these offline accounts and Cotten overlooked the need to leave a record of the login credentials.
Naturally, QuadrigaCX is in a very big pickle at the moment and what’s worse, it all could have been avoided with some simple estate planning
How A Robust Estate Plan Protects ALL of Your Assets, Digital or Otherwise
You don’t need to control hundreds of millions of dollars in other people’s money to institute basic protections which ensure nothing is lost when you die. Even if all you store online are precious memories and irreplaceable photos, it is still important to record usernames and passwords in your estate plan.
A durable power of attorney is one among many documents that ensure loved ones retain access to your assets no matter what happens to you. By designating a family member or trusted advisor to manage your financial affairs in the event you suffer incapacitating injury and by including all necessary credentials to do so, you add a crucial layer of protection to your life’s work.
In addition to a durable power of attorney, instituting a trust helps avert catastrophe by providing a trustee access to assets eventually destined for a third-party beneficiary. Different types of trusts provide different types of security and so it is important to speak with an experienced estate planning attorney when determining which best suits your purposes. An irrevocable trust, for instance, will shield you from estate taxes while a living trust will allow a trustee to exercise control over a child’s inheritance should you pass while they are still a minor.
If you own digital assets, ensuring they are accounted for in your estate plan is doubly important as regulations governing this new marketplace have not kept up with technological developments. As the tragic story of Cotten’s passing illustrates, this can provoke disastrous consequences.
To learn more about protecting both your life’s work and your loved ones, do not hesitate to reach out to the Law Firm of Christopher W. Dumm to talk with a trusted estate planning attorney either by calling 417-623-2062 or using the contact form on our website.
Contact the Estate Planning Attorneys at the Law Firm of Christopher W. Dumm