When it comes to deciding what to include in a Will, most people would understandably consider the tangible assets they can leave behind for their loved ones. This will often come in the form of property, money and any family heirlooms, but of course it depends on the someone’s individual circumstances. But what about assets that are not tangible?
The rapid rise of crypto currency has brought about a new way to own digital content. A non-fungible token (NFT) is a unique unit of crypto currency which provides a digital certificate for the ownership of a digital asset.
As digital assets are now considered to be just as valuable as any physical alternative, it’s only sensible that NFTs would be included in Wills. But is that possible? And, if so, what steps are involved in the process?
Here, we will discuss the rise of NFTs and how they may shape the future of Wills and estate planning moving forward.
What is a non-fungible token (NFT)?
The best way of explaining an NFT is to break down the semantics. Non-fungible refers to something that cannot be replaced with anything else, even if it holds equal value. This means that an NFT is a unique asset that cannot be traded for something of equal value.
As we previously discussed, an NFT is not necessarily tangible, which means it isn’t something you can physically handle. Instead, it is a collectible digital file, which in theory, means it can be anything that can be digitally saved and stored.
Explaining why NFTs are an attractive prospect, despite not being tangible or easily tradeable, Auction platform Valuables explained that: "Like an autograph on a baseball card, the NFT itself is the creator's autograph on the content, making it scarce, unique, and valuable,"
The market for NFTs is rapidly expanding, with musicians, artists and video editors all selling their digital assets in return for substantial sums.
What does an NFT look like?
While that explanation is useful to an extent, to get a better understanding of what an NFT is, it can be more beneficial to use real-world examples.
In March 2021, Twitter CEO Jack Dorsey put his first-ever tweet up for action and, in return, received an astonishing bid of $2.5 million. Around the same time, the band Kings of Leon announced that they would only offer their latest album on NFTs, being released on YellowHeart, an NFT platform. The album was only available on the site for two weeks, after which no more digital copies were made.
How do NFTs relate to Wills and estate planning?
If you own an NFT, then including it in your Will should be a top priority – especially if it’s considered to be highly valuable. Just like any other asset, it’s important to protect your investment and ensure that it’s passed on exactly as you wish when you’re no longer around.
However, the process isn’t necessarily that straightforward. If you plan to include an NFT in a Will, this is possible, but you also need to be sure that passwords or personal keys are also included to ensure that the future inheritor is able to access it. If the correct passwords are not included, or it’s not made clear exactly how the NFT should be passed on, there is a risk that the digital asset will be sold off or liquidated.
Including NFTs in a Will, along with the relevant passwords or access codes, also ties in with in with protecting your ‘digital legacy’, something the younger generation are increasingly focusing on when creating Wills.
Do you need a lawyer to help you with NFTs and Wills?
Speaking to a Wills specialist lawyer is always recommended when it comes to creating a Will from scratch, or amending a Will to include relevant assets, such as an NFT. As there are various strict legal requirements associated with Wills, a Will specialist can ensure that all of your assets (digital or otherwise) are properly accounted for and passed on exactly as you wish.
Working with a specialist Wills lawyer will also help to reduce the potential for any future disputes among your loved ones relating to the contents of your Will, so you can rest assured that your wishes will be followed.
Do you need advice about making a Will?
If you need advice about including an NFT in a Will, or any other related matter, our specialist Wills lawyers in Newport are on hand to lend practical support and guidance.
We offer a free 30-minute consultation either by phone or at our offices, to enable you to make an informed decision as to whether you need to make a Will and, if so, the type of Will that best suits your needs.
Give us a call at our offices in Newport or fill in our simple online enquiry form and a member of our team will be in touch in due course.
