Keep your crypto secure, yet accessible
A cold wallet can be a small physical storage device that’s easy to misplace. Your cold wallet requires a PIN code for access, plus you set up a recovery phrase as a backup in case you lose your key. According to Mejias, a fireproof safe at home or a safety deposit box at a bank is a must, but don’t store your cold wallet in the same place as the note containing your key, PIN and recovery phrase. If someone finds all of those items together, it’s bye-bye Bitcoin.
Above all, design a storage method that makes sense. “Don’t get so cute that you make some complicated system that you can’t remember,” Mejias says. He’s heard of people writing down their keys and cutting the paper into three pieces, hiding each piece in a separate location. “It sounds like a good idea, but it’s a horrible idea. If you lose one of those three, it’s gone forever. You’ve tripled your risk.”
Make a detailed plan for your loved ones
Name a beneficiary in your will and add a document to your estate plan that lists your crypto assets and any passwords, PINs, keys and instructions to find your cold wallet. If you have an account at a cryptocurrency exchange, your beneficiary can contact customer support to notify them of your death.
According to a Coinbase representative, there is a process in place to guide next of kin, including one-on-one assistance from a Coinbase analyst. Gemini requires a death certificate and power of attorney to initiate a transfer out of a deceased person’s account.