Estate Planning for NFT Owners: A Necessary Step
In the world of digital art, NFTs or non-fungible tokens have emerged as a new form of investment. These unique digital assets are stored on a blockchain network, making them difficult to replicate or counterfeit. With the growing popularity of NFTs, it’s important for owners to consider what happens to their assets after they pass away. Estate planning for NFT owners is a necessary step that should not be overlooked.
From a legal standpoint, creating an estate plan, which is simply arranging the management and disposal of properties in preparation for future incapacity or death, seems like a good approach. Jaime Herren, a wealth services lawyer, told Cointelegraph that this might be the best step that NFT owners can take to make sure their NFTs are passed on to their loved ones after death. Herren explained that:
“Without a plan in place, the NFTs could be lost or forgotten, and the value of the assets could be lost forever. Estate planning can help ensure that your NFTs are passed on to your heirs according to your wishes, and that they are properly managed and maintained.”
It’s important to note that NFTs are not like traditional assets. They are not physical, and they exist only on a digital platform. This means that estate planning for NFT owners requires a different approach. Herren suggests that NFT owners should work with a lawyer who is familiar with the technology and can help them navigate the legal complexities.
One of the challenges of estate planning for NFT owners is determining the value of the assets. Unlike traditional assets that have a clear market value, NFTs are often subjectively priced. Herren suggests that NFT owners should consider getting an appraisal to determine the value of their assets. This can help ensure that the assets are properly distributed to heirs and that their value is not lost.
Another important consideration for NFT owners is the transfer of ownership. NFTs are often bought and sold on various digital platforms, and it’s important to ensure that the ownership of the assets is properly transferred. Herren suggests that NFT owners should keep a record of their transactions and ensure that the transfer of ownership is properly documented.
In addition to estate planning, NFT owners should also consider creating a digital will. A digital will is a legal document that outlines how a person’s digital assets should be managed and distributed after their death. This can include NFTs, cryptocurrencies, and other digital assets. Herren suggests that NFT owners should work with a lawyer to create a digital will that is legally binding.
In conclusion, estate planning for NFT owners is a necessary step that should not be overlooked. NFTs are a new form of investment that requires a different approach to estate planning. NFT owners should work with a lawyer who is familiar with the technology and can help them navigate the legal complexities. They should also consider getting an appraisal to determine the value of their assets, keeping a record of their transactions, and creating a digital will. By taking these steps, NFT owners can ensure that their assets are properly managed and passed on to their loved ones according to their wishes.