Over 60 million Americans (20%) own crypto, over half of millennials earning over 75K do, and that number continues to increase. Crypto poses unique challenges to estate planners, financial advisors, and other types of services and it’s not going away. Your clients want you to store copies of their crypto for safekeeping while exposing you to massive liability, don’t let them!
Here’s just some of the reasons you don’t want to store your client’s crypto in unencrypted form:
- Anybody who gains access to the private key can spend the crypto, period. These transactions are irreversible. Unlike a bank account or credit card (and like cash), there is zero ability to reverse a transaction. A judge can order a person or company to do something, they cannot order a blockchain to do something because a blockchain is decentralized and exists across many jurisdictions.
- Your client can change the amount of crypto stored in an address at any time without your permission or knowledge. The value of that crypto can also change at any time, and often does!
- If you store crypto for a client and it gets stolen:
- Your client will expect you to cover the loss.
- Your insurance company won’t care, your bank won’t care, nobody will bail you out.
- Because the key that is stolen is the same key your client keeps custody of, it could be that you are not even at fault, but there will be no way to prove this.
- Don’t be fooled by “encrypted” cloud storage providers: they often have the keys to “decrypt” the data you store with them and do not protect data at rest. If somebody breaks into your computer, all the encryption in the cloud won’t help you against local data theft.
And yet, as an estate planner, you cannot simply ignore your client’s crypto assets. If you refuse to work with crypto, you are missing an opportunity to serve a client, and that client may pursue another firm that is able to.
TC vaults make it easy to safely store your clients crypto and ensure it can be safely passed on to heirs. It does this by exposing you to zero additional liability. How does it work?
- A TC vault is an encrypted folder. Your client’s crypto private keys, wallet files, etc are placed into this folder. The vault cannot be opened without the correct passphrase.
- Because the folder is encrypted, the client can give a copy to you. Without the passphrase, you can’t open the vault, which means if your copy is stolen or lost, no harm is caused.
- The passphrase to open the vault can be split into multiple parts which can later be re-assembled in the event of the client’s death or if they simply forget their passphrase. The client sets the terms (how many keys are made and how many keys need to be present for the passphrase to be re-assembled) for reassembly. Because you only hold part of the passphrase, if you lose your copy or it gets stolen, it’s no problem!
- We provide a secure, offline laptop to your client to make it easy to create, manage, and backup their vault
- Trustless Custody never has access to the vault, the passphrase, or any of the information the vault contains. The vault remains private to your client and anybody else they grant access to. The encryption protocols used in our vault have been battle-tested and audited for years. We’re so confident in their ability that we’ve even placed our own Bitcoin in them and published our vault for anybody to crack.