Roughly 90% of cryptocurrency investors worry about what will happen to their crypto assets when they die. However, only a few are planning appropriately for such an event.
Most Crypto Investors Concerned About Their Assets
Around 90% of crypto investors are concerned about the fate of their assets when they pass on. However, only a few are making plans to ensure that their loved ones gain instant access to their cryptocurrency assets. Interestingly, the study shows that younger investors are not particularly worried about such events.
A new study conducted by the Cremation Institute showed that only about a quarter of Bitcoin investors had properly planned how their cryptocurrency funds will be distributed after their death.
The younger investors, those between the ages of 18 and 40, are ten times more likely to be without a plan compared to the older generation, the study found. According to the study, about 65% of millennials and 41% of the Generation Z investors reported having put in place a plan on how their cryptocurrency wealth will be passed on to their relatives and loved ones after their death. These figures are low compared to the 86% of Generation X (41 to 55 years) and 94% of baby boomers (56 to 76 years). Most of the people in those categories have a plan to ensure that their cryptocurrency assets are inherited without any issues.
The study, published on July 7, stated that although complacency is a large factor, the combined problem of the absence of cryptocurrency estate services and government regulation are some of the reasons why people do not plan their cryptocurrency inheritance.
Crypto Locked Forever
In the past, the crypto world has seen numerous examples of Bitcoin investors around the world who have died without leaving their private keys for their relatives. The most popular one is that of the owner of Canadian cryptocurrency exchange QuadrigaCX, whose death led to exchange members losing millions of dollars in crypto as he was the only one who knew the password to the company cold wallet. In such cases, the relatives of the deceased usually need to deal with a double loss as they have lost their loved one and the assets that he/she left behind.
These statistics do not shed a good light on Bitcoin and other cryptocurrencies. According to Coincover, around 4 million BTC (roughly $37 billion) has been lost forever after the death of the owners. One of the most widely publicized examples is that of paranoid U.S. investor Matthew Mellon who died in 2018 and left a few clues that lead to a cryptocurrency fortune set to be worth more than $500 million back then.
Cremation Institute surveyed 1,150 people between October 2019 and June 2020 in its study. The aim of the Cremation research is to understand the metrics behind cryptocurrency investors who had a plan for what would happen to their investment after they die in addition to those that do not have a plan.
The study also wanted to look at the proportion of the investors with plans, how they planned, and whether they are bothered about losing their assets. From the study, it shows that 65% of investors store their assets and details of their cryptos in their households, making it easy for their spouses to access. Computers (17%) and USB (15%) were the other popular storage methods used by cryptocurrency investors.
The report further highlighted that women have a more likely chance of coming up with a contingency plan in case of their demise than men. Amongst baby boomers, men planned more than women. However, in the other age groups, women planned more than the men, the study added.