WHO INHERITS THE DIGITAL ESTATE? RETHINKING SUCCESSION LAW IN THE AGE OF VIRTUAL ASSETS

INTRODUCTION

Traditionally succession rules govern the transfer of property, rights and obligations that occurs after the death of the owner. Throughout history, people have been thinking about inheritance laws, mainly that of tangible assets like land, houses, jewellery, and financial investments. But, with the increasing digitalisation of today’s lifestyle, the definition of personal wealth has changed. People have many digital assets that encompass their social media accounts, cryptocurrency holdings, pictures that are stored in the cloud, online businesses, domain names, digital wallets, gaming assets and non-fungible tokens (NFTs). Such assets can be of a high monetary, emotional and/or business nature.[1]

Nevertheless, despite this change, the laws of inheritance have struggled to catch up in the world with the technological advancements. Most law systems were created to regulate tangible assets and traditional monetary assets and not virtual assets stored on digital systems. This often leaves people uncertain about where their digital assets would be held after their owner passes away and whether they can be transferred to someone else or accessed.[2]

It’s not just a matter of money. There are many things on digital accounts that may have personal communications, memories, intellectual creations and sensitive information. Digital legacy issues therefore raise not only question related to property rights, but also questions of privacy, contractual obligations and data protection.[3] With no clear legal framework in place, conflicts arise among heirs, technology providers and regulators.[4]

This article discusses the notion of digital inheritance, analyzes the legal issues related to virtual assets and explores current solutions in various jurisdictions and proposes that law dealing with succession needs to evolve to fit in with the realities of the digital world.

UNDERSTANDING DIGITAL ASSETS AND DIGITAL INHERITANCE

“Digital assets” are any content, information and/or property that is stored in digital form for which an individual has an ownership, control or economic interest. These can generally be classified in three categories namely, personal, financial and commercial.[5]

Social media, e-mail, photos, videos, blogs, cloud storage accounts are examples of personal digital assets. Financial digital assets are cryptocurrencies, digital wallets, online investment accounts, and NFTs. Commercial digital assets include online businesses, digital intellectual property, domain names and online platforms that generate income.

Digital Inheritance is the will of these assets after the death of the owner. Digital inheritance, however, poses a different challenge to that of traditional inheritance as it presents two distinct challenges of ownership and access. Heirs might have legal rights to an asset, but not have the legal authority or the technical ability to access the asset. Accessibility issues are common with other security layers like passwords, encryption and platform security policies that have no counterpart in conventional real estate.

One of the clarifying issues of digital succession law is that between property and access. A family could receive the legal rights to a person’s digital property, but still not be able to access or have it in their control because the technology or terms of use of the online services they had may prohibit it.[6]

Therefore, the traditional succession principles are not sufficient to address digital inheritance. It needs a legal structure that can balance out rights to property, technological realities and privacy issues.

CHALLENGES FACED BY EXISTING SUCCESSION LAWS

Digital inheritance faces many problems, including a lack of legal recognition for many forms of digital property. The inheritance rules that are commonly in use take for granted that property is physically or easily legally identifiable. Digital assets can be hard to understand using these categories.

Many online platforms do not follow ownership rather they follow licensing. Limited access to services, instead of full ownership of digital content. Thus, when a user dies, contractual rights may end, rather than transfer to the heirs.

A major issue that can occur is the terms of service agreement tech companies impose. Many social media, email and cloud storage services include features with limitations in transferring accounts. These contractual agreements can be in conflict with the inheritance laws, since they can give access to accounts that are part of the deceased’s digital estate.[7]

The complexity of jurisdictions also adds to the complexity. Digital assets can be located in a number of countries at one time. An Indian user can store data on the European servers and use services operated by a corporation with a U.S. headquarters. It can therefore be very challenging to determine which country’s laws govern succession rights.[8]

Also, many people don’t keep a record of their passwords, encryption keys and account details. Even if there are rights to be enforced, heirs may not be able to do so. Digital property cannot always be documented and handed over as part of the physical property, unlike physical property, and can be absolutely lost if the owner dies.

The problems show that existing laws regarding succession are not structured to deal with digital property and will need to be adjusted more and more.

CRYPTOCURRENCY AND DIGITAL WEALTH: A NEW DIMENSION

Cryptocurrencies are by far the most complicated digital asset in legal and practical terms regarding inheritance. Bitcoin and other cryptocurrencies have ushered in a form of wealth not tied to conventional banking systems.[9]

Cryptocurrencies are not regulated like normal bank accounts but instead are controlled by the use of private cryptographic keys. Whilst a public key is algorithmic and known to everyone, the private key is the one that really controls access to the asset. If lost, it may be impossible to get into the cryptocurrency ever again.[10]

This attribute poses special succession issues. With traditional inheritance systems, the financial firms can help heirs identify the assets and move them. Cryptocurrency networks, however, don’t have central authorities to provide access or to validate any inheritance claims.

Many cases of large amounts of cryptocurrencies becoming unobtainable after their owners died have been reported. In these cases, useful securities de facto cease to exist although in law they are part of the estate of the deceased.[11]

There’s a wide disparity in the legal standing of cryptocurrencies in different regions. Some nations consider them to be property, others see them as commodities or even digital assets or speculative instruments. This, in turn, raises some doubts about the rights to inherit and tax duties.[12]

As cryptocurrencies become more mainstream, there is a need to have well defined succession measures by lawmakers. Digital wills, safe key management systems and legally valid nomination processes could be helpful ways to solve the problem. Otherwise, a significant amount of digital assets can be lost forever upon death of their owner.

RIGHT TO PRIVACY FOR THE DECEASED AND HEIR INTERESTS

Digital inheritance poses some key issues about the balance between privacy and succession rights. Digital accounts often include confidential communications, photographs, medical information, private messages and other personal items that are much more intimate than those found in traditional property.[13]

Family members commonly try to gain entry to these accounts as a result of sentimental, monetary, or administrative reasons. There can be privacy interests that belong to the deceased, or third parties who interacted with the private person during his lifetime that might be compromised by giving the information out unrestricted.[14]

If the deceased hasn’t made clear what they would like to happen to their digital information, the situation becomes complicated. To allow heirs to read private e-mail? Should social media conversations be made public? When confidential personal records come into existence through a person’s death, should they be available?

The various personalities of technology firms have responded differently. Some of the platforms allow for a memorialisation of accounts, although access to content may be limited.[15] Others may give the power to a person of their choice to handle some parts of an account in the event of their demise.[16]

There should be a balance between the legitimate interests of the heirs and the ongoing privacy interests of deceased persons. Access rights should be proportionate, for legitimate purposes and be subject to appropriate safeguards. While succession rights are important, courts and legislatures need to make sure that they don’t serve as a wholesale justification for inappropriate interference with privacy.

A COMPARATIVE APPROACH TO DIGITAL INHERITANCE

Some jurisdictions are starting the discussion around digital inheritances and the issues that come up with them, but solutions are still disjointed.

In the United States, the legislative efforts have been aimed at trying to iron out any confusion over who is a fiduciary and who has access to digital assets. Some legislation allows for access by an executor, trustee or authorised representative to a digital property in certain circumstances. These measures aim to equate succession rights with the right to privacy and ask for contractual agreement.[17]

Digital inheritance can essentially be handled in European jurisdictions by a combination of succession law, data protection law and contractual principles. The privacy and the protection of personal data revolve in the center of most interests; this can affect decisions about accessing digital information after death.[18]

At the present time, however, there is no comprehensive legislation in India specifically dealing with digital inheritances. Succession rules still basically apply the same way when it comes to succession transfers and digital assets are typically handled by contractual agreements and platform policies. This adds doubts about cryptocurrencies, online accounts, and the other virtual assets.[19][20]

A major challenge is that there are no common international standards. With international scope of digital platforms, disjointed legal strategies could lead to different outcomes and cross-border conflicts. Future reforms should then strive to achieve a harmonisation and legal certainty.[21]

NEED FOR A DIGITAL SUCCESSION FRAMEWORK

As digital assets continue to play a significant role, it is crucial to institute innovative legal frameworks to meet the demands of the modern world. Digital estates are too complex to be managed by traditional succession laws.[22]

First, legislatures need formally to establish the inheritable nature of digital assets, to the extent that that is appropriate. Given clearly defined laws, there would be less uncertainty and estate administration would be easier.

Secondly, legal frameworks should be promoted for electronic wills. These tools would allow someone to stipulate what their digital assets should be done with after they pass away. This would help to greatly minimize conflicts among heirs and other services involved.[23]

Third, tech firms need to have open succession processes. There should be options for users to set up their beneficiaries, trusted contacts or digital executors who can handle their accounts after their death.[24]

Fourth, there should be certain clauses related to the inheritance of cryptocurrencies. Valuable digital assets might be saved through secure storage solutions, regulated custodial services and inheritance-friendly key management practices which could prevent their permanent loss.[25]

Lastly, there is a need for international collaboration. Digital assets often cross borders and harmonisation would lead to a more consistent, predictable, and fair treatment of succession to digital assets.

A digital succession framework would not just clarify the current legal grey areas but also be the first step towards enabling legal systems to adapt to future technological advancements.

CONCLUSION

Digital revolution has changed the concept of the property, wealth, and private identity. People have vast digital collections of assets, intellectual property, memories and property. However, inheritance policies are not keeping up with technology.

Digital inheritance poses distinct issues of ownership, access, privacy, contractual conditions and jurisdictional complexities. Specifically, these problems may manifest themselves with respect to cryptocurrencies, social media accounts, or other cloud-based assets, where traditional legal systems may have limited coverage.

The value and relevance of digital assets are growing, and so is the need for new succession laws. There is a need for legal systems to shift out of the traditional thinking on inheritance, and create more robust systems tailored for the digital age. Digital asset recognition, digital estate planning promotion, greater clarity of duties for technology companies and greater international cooperation are all significant aspects of this process.

The bottom line on both inheritance law is that it is no longer about a body of property. It now has to deal with the more general issue of the life on the Internet after death. The response to this question will help to determine the future of property rights, privacy, and succession law in the twenty-first century.

REFERENCE(S):

1. Beyer, Gerry W. & Naomi Cahn, Digital Planning: The Future of Elder Law, 9 NAELA J. 135 (2013).

2. Cahn, Naomi, Postmortem Life On-Line, 75 Prob. & Prop. 36 (2011).

3. California Probate Code §§ 870–884 (West 2016).

4. De Filippi, Primavera & Aaron Wright, Blockchain and the Law: The Rule of Code (Harvard Univ. Press 2018).

5. Edwards, Lilian & Edina Harbinja, Protecting Post-Mortem Privacy: Reconsidering the Privacy Interests of the Deceased in a Digital World, 32 Cardozo Arts & Ent. L.J. 83 (2013).

6. Facebook Help Center, Memorialized Accounts, https://www.facebook.com/help/1506822589577997 (last visited June 15, 2026).

7. Facebook (Meta Platforms, Inc.), Terms of Service, https://www.facebook.com/terms.php (last visited June 15, 2026).

8. Google, Inactive Account Manager, https://myaccount.google.com/inactive-account-manager (last visited June 15, 2026).

9. Hague Conference on Private International Law, Report on the Disposition of Digital Assets on Death, Prel. Doc. No. 6 (2023).

10. Indian Succession Act, 1925, No. 39, Acts of Parliament, 1925 (India).

11. Information Technology Act, 2000, No. 21, Acts of Parliament, 2000 (India).

12. Internal Revenue Service, Virtual Currencies, I.R.S. Notice 2014-21, 2014-16 I.R.B. 938.

13. Mazzone, Jason, Facebook’s Afterlife, 90 N.C. L. Rev. 1643 (2012).

14. Nakamoto, Satoshi, Bitcoin: A Peer-to-Peer Electronic Cash System (2008), available at https://bitcoin.org/bitcoin.pdf.

15. Popper, Nathaniel, Lost Passwords Lock Millionaires Out of Their Bitcoin Fortunes, N.Y. Times (Jan. 12, 2021), https://www.nytimes.com/2021/01/12/technology/bitcoin-passwords-wallets-fortunes.html.

16. Reserve Bank of India, Circular on Virtual Currency, RBI/2017-18/154 (Apr. 6, 2018).

17. Revised Uniform Fiduciary Access to Digital Assets Act (Unif. Law Comm’n 2015).

18. Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the Protection of Natural Persons with Regard to the Processing of Personal Data (General Data Protection Regulation), 2016 O.J. (L 119) 1.

19. Uniform Law Commission, Revised Uniform Fiduciary Access to Digital Assets Act (2015), available at https://www.uniformlaws.org.

20. Yu, Peter, Digital Copyright and Confuzzling Rhetoric, 13 Vand. J. Ent. & Tech. L. 881 (2011).

21. Ziff Davis, LLC v. Ziff Davis Publ’g Holdings, Inc., 145 F. Supp. 2d 256 (S.D.N.Y. 2000).

[1]Uniform Law Commission, Revised Uniform Fiduciary Access to Digital Assets Act (2015), available at https://www.uniformlaws.org/committees/community-home?CommunityKey=f7237fc4-74c2-4728-81c6-b39a91ecdf22.

[2]Naomi Cahn, Postmortem Life On-Line, 75 Prob. & Prop. 36 (2011).

[3]Lilian Edwards & Edina Harbinja, Protecting Post-Mortem Privacy: Reconsidering the Privacy Interests of the Deceased in a Digital World, 32 Cardozo Arts & Ent. L.J. 83, 84 (2013).

[4]Jason Mazzone, Facebook’s Afterlife, 90 N.C. L. Rev. 1643, 1645 (2012).

[5]Gerry W. Beyer & Naomi Cahn, Digital Planning: The Future of Elder Law, 9 NAELA J. 135, 137 (2013).

[6]Ziff Davis, LLC v. Ziff Davis Publ’g Holdings, Inc., 145 F. Supp. 2d 256 (S.D.N.Y. 2000) (illustrating how licensing arrangements differ from ownership in digital contexts).

[7]Terms of Service Agreement, Facebook (Meta Platforms, Inc.), Terms of Service, https://www.facebook.com/terms.php (last visited June 15, 2026) (providing that accounts are non-transferable and that the company reserves the right to terminate accounts upon death).

[8]Peter Yu, Digital Copyright and Confuzzling Rhetoric, 13 Vand. J. Ent. & Tech. L. 881, 892 (2011).

[9]Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Electronic Cash System 1 (2008), available at https://bitcoin.org/bitcoin.pdf.

[10]Primavera De Filippi & Aaron Wright, Blockchain and the Law: The Rule of Code 15–16 (Harvard Univ. Press 2018).

[11]See, e.g., Nathaniel Popper, Lost Passwords Lock Millionaires Out of Their Bitcoin Fortunes, N.Y. Times (Jan. 12, 2021), https://www.nytimes.com/2021/01/12/technology/bitcoin-passwords-wallets-fortunes.html.

[12]Internal Revenue Service, Virtual Currencies, I.R.S. Notice 2014-21, 2014-16 I.R.B. 938 (treating cryptocurrency as property for federal tax purposes).

[13]Edwards & Harbinja, supra note 3, at 101–05.

[14]Mazzone, supra note 4, at 1668–70.

[15]Facebook Help Center, Memorialized Accounts, https://www.facebook.com/help/1506822589577997 (last visited June 15, 2026).

[16]Google, Inactive Account Manager, https://myaccount.google.com/inactive-account-manager (last visited June 15, 2026) (allowing users to designate trusted contacts and determine what happens to their data upon inactivity).

[17]Cal. Prob. Code §§ 870–884 (West 2016) (California’s enactment of RUFADAA, permitting fiduciary access subject to the decedent’s prior online tool consent or written directive).

[18]Council Regulation 2016/679, of the European Parliament and of the Council of 27 April 2016 on the Protection of Natural Persons with Regard to the Processing of Personal Data, 2016 O.J. (L 119) 1 [hereinafter GDPR]; see also Recital 27 (noting that the GDPR does not apply to personal data of deceased persons but allowing Member States to provide rules relating to such data).

[19]Indian Succession Act, 1925, No. 39, Acts of Parliament, 1925 (India) (governing testamentary and intestate succession in India but containing no specific provisions for digital assets).

[20]Information Technology Act, 2000, No. 21, Acts of Parliament, 2000 (India); see also Reserve Bank of India, Circular on Virtual Currency, RBI/2017-18/154 (Apr. 6, 2018) (restricting banking services related to cryptocurrencies, demonstrating the evolving and uncertain regulatory environment).

[21]Hague Conference on Private International Law, Report on the Disposition of Digital Assets on Death, Prel. Doc. No. 6 (2023), available at https://www.hcch.net (examining the cross-border dimensions of digital inheritance and the need for harmonised international rules).

[22]Cahn, supra note 2, at 40–41.

[23]Beyer & Cahn, supra note 5, at 152–55 (discussing digital estate planning tools including password managers and digital wills).

[24]RUFADAA, supra note 17, §§ 4–5 (establishing a hierarchy of user direction, platform terms of service, and fiduciary law for resolving digital asset succession).

[25]De Filippi & Wright, supra note 10, at 45–48 (discussing smart contract mechanisms that could enable automated transfer of blockchain-based assets upon death).