6/29/2022
Digital assets have been increasingly present in people’s lives, generating legal impacts in relation to the estate and its succession.
In any event, what can, after all, be considered digital asset and digital inheritance? Digital assets are not only the ones with economic value – such as cryptocurrencies, mileage programs, electronic files of industrial/corporate secrets, among others – but also those with sentimental value – like social media accounts, e-mail and WhatsApp messages. These assets constitute a ‘digital inheritance’ and, therefore, in a succession context, all of them should be taken into account.
The legislative gap regarding this matter has been triggering extensive discussions, especially in the judicial field, as to heirs right to access the deceased’s social media accounts, messages or photo gallery.
Under a legal point of view, there is no controversy about the succession of digital assets with economic value, but, in practice, there have been some difficulties for the heirs to access them, especially in relation cryptocurrencies and tokens, due to their key features.
Gerald Cottens, founder of QuadrigaCX, a Canadian broker, is a very emblematic case in such regard. As the only individual with access to his clients’ cryptocurrency investments password (‘private key’), Cotten died unexpectedly in 2018. Due to the sophisticated cryptography used in the blockchain system, it was impossible to recover the clients’ investments private key, leading QuadrigaCX to a loss of US$ 190 million, jeopardizing approximately 115 thousand clients.
As to the succession of sentimental value digital assets, in cases in which the deceased doesn’t expressly establish its will regarding their destination, there is still a lot of controversy as to whether the deceased’s heirs may be allowed access to them considering the deceased’s right to privacy and intimacy.
It has therefore become extremely important to think about and plan the destination of digital assets, not only the ones with economic value, but also those with sentimental value, either upon execution of a last will, of a fiduciary agreement, or of other legal tools, given that the access of individuals to their own assets has been migrating to digital environment in an astonishing speed.
Coauthors: Isabela Rodrigues Alves de Sá e Silva and Marcelo Trussardi Paolini
