How to pass on bitcoins to your children/beneficiaries

[jubalix]

I am trying to figure out how to pass on bitcoins via trust or will or some other service/instrument.

The problems are multiple

[1] How do you trust some one to do this, they can simply abscond, and it would be hard to track/stop/recover

[2] If the child/beneficiary is not technically good, and can't grasp private keys, and the pitfalls with bitcoin use, and wallets, encryption/duplication and back up of data sets etc

[3] Air gaping etc

I'm sorta thinking that you need a service, that gets one key file for say true a crypt container and another separate organization gets another key file  and both then sends them to the beneficiary and neither organization knows who you gave the other key file to.

then the person can unlock the encrypted file, which you left them on multiple media and cloud etc, and you have to leave detailed instructions and say some GLD coins or cheap coin in a wallet/with private keys as well and tell them to play with that first, back up etc etc

open to ideas

It sorta really important say you get hit by a bus , and don't have this set up, that's its all for nothing.


EDIT [1]
The cacassius, solution does not imho sufficiently cover the use of BTC/CC's to ensure they don't screw it all up.

EDIT [2]
The insta death prevents all the hand over on death bed options and similar.

EDIT [3]
I propose the following solution


It needs to be a Company, as good as a single person is, if they get insta gib'ed game over.  The Company can survive indefinitely, and employ people like John K.

The Company must be

>Trusted
>Knowledgeable about BTC/Tech/Tru Crypt (pref to pywallet level at least)
>Legally Professionals (for relevant jurisdiction)
>Tax training (for relevant jurisdiction)

The client useing truecrypt and choose key files and only give one to the Company and another to  say typical trust / will / lawyer and the encrypted truecrypt container to kids, and lawyers and on the net.

After Passing away, the Company would be contacted by the deceased lawyers and merely told of the passing and the children's beneficiaries location, or if you want this could be triggered by a dead mans swicth that emails the Company to a pre arranged

The Company would then sit down over for say 1-2 hours a week/fortnight over 2 months and make sure the child/beneficiary demonstrated an understanding of bitcoin tech from a private key level, moving bitcoins, dangers of online wallets with examples, exchanges and their risks, tax implications in their jurisdiction, and air gaping etc etc, examination, and use cheap coin eg GLD or any other cheap alt to test/teach.

After this the hand over key file [1].

Keyfile [2] held by other company merely turns up and gives key file to the relevant person.

As an aside This make the values really easy to apportion by the settlor (Parent) as they can move amounts between keys any time, no need to go back to the lawyer/company etc.

 

[marcovaldo]

You can just write the private key in a letter, and seal the letter and gave it to a lawyer who will give it to your children when you die.

[Seccour]

Private key and explain of what is bitcoin and how does it work. ( if they don't know ^^ )

[jubalix]

You can just write the private key in a letter, and seal the letter and gave it to a lawyer who will give it to your children when you die.

there is no way I would trust a lawyer with this, he opens letter and burns it after. No one would ever know!

[Dabs]

Deadmansswitch.net

[Rannasha]

You can just write the private key in a letter, and seal the letter and gave it to a lawyer who will give it to your children when you die.

there is no way I would trust a lawyer with this, he opens letter and burns it after. No one would ever know!

Split the private key using Samir's Secret Sharing algorithm and give several trusted parties a fragment. For example, a 3-of-5 scheme where you give a fragment to a spouse, friend, family member, lawyer and bank deposit box. Any 3 fragments can be used to recover the private key. A short instruction on what Bitcoin is and how to use the private key you can spread more liberally to your beneficiaries.

[sunnankar]

Split the private key using Samir's Secret Sharing algorithm and give several trusted parties a fragment. For example, a 3-of-5 scheme where you give a fragment to a spouse, friend, family member, lawyer and bank deposit box. Any 3 fragments can be used to recover the private key. A short instruction on what Bitcoin is and how to use the private key you can spread more liberally to your beneficiaries.

Something like this along with Armory. And use KeepassX to manage some of the sensitive information.

Or pre-craft the transactions, but do not submit them to the network, and then have them provide a public key they control that is in a cold wallet or give them the private keys to the txouts. This is handy because you can pre-craft multiple transactions for the same bitcoins and it is just the first that gets submitted that actually matters. So you can have scenarios pre-crafted.

[Kluge]

You can just write the private key in a letter, and seal the letter and gave it to a lawyer who will give it to your children when you die.

there is no way I would trust a lawyer with this, he opens letter and burns it after. No one would ever know!

Split the private key using Samir's Secret Sharing algorithm and give several trusted parties a fragment. For example, a 3-of-5 scheme where you give a fragment to a spouse, friend, family member, lawyer and bank deposit box. Any 3 fragments can be used to recover the private key. A short instruction on what Bitcoin is and how to use the private key you can spread more liberally to your beneficiaries.

I was actually thinking recently - this would be an interesting place for John K to branch out, and maybe finally form a proper company, since he already holds so much in escrow and has trust established unlike any other member of the community. Since he's quite knowledgeable in Bitcoin, he can offer a Q&A session with family, whereas a letter can't do that and you need to have everything either fully explained to them while you and they are both alive, or a pretty darn good (long) explanation in text.

You would pay someone like John to both hold a key fragment and explain to the beneficiaries what Bitcoin is and what their options are. Of course, if you don't go through someone like John, you might not expect them to realize the massive death taxes they'd be liable for in most countries.

[marcotheminer]

Private key on a piece of paper then give it to them on your death bed

[Rannasha]

Private key on a piece of paper then give it to them on your death bed

That won't do you much good if you die suddenly, like in an accident.

[Dabs]

I was actually thinking recently - this would be an interesting place for John K to branch out, and maybe finally form a proper company, since he already holds so much in escrow and has trust established unlike any other member of the community. Since he's quite knowledgeable in Bitcoin, he can offer a Q&A session with family, whereas a letter can't do that and you need to have everything either fully explained to them while you and they are both alive, or a pretty darn good (long) explanation in text.

You would pay someone like John to both hold a key fragment and explain to the beneficiaries what Bitcoin is and what their options are. Of course, if you don't go through someone like John, you might not expect them to realize the massive death taxes they'd be liable for in most countries.

From my private discussions with him, John K actually has a lawyer, for in case he goes, the lawyer does the escrow.

For this particular purpose, as soon as you can, educate your children/beneficiaries about bitcoin. Get them to use it. Go buy a ticket from my lotto. Go to bitcoinstore.com and buy a computer. Go to bitstamp to exchange.

Then, once you know they understand about bitcoin, tell them you have a dead man's switch for their current email address with their current GPG key, because you will surely send or compose it encrypted, and/or you have a sealed envelope at your vault just for them containing a cold wallet private key.

They know what to do with it.

[Kluge]

I was actually thinking recently - this would be an interesting place for John K to branch out, and maybe finally form a proper company, since he already holds so much in escrow and has trust established unlike any other member of the community. Since he's quite knowledgeable in Bitcoin, he can offer a Q&A session with family, whereas a letter can't do that and you need to have everything either fully explained to them while you and they are both alive, or a pretty darn good (long) explanation in text.

You would pay someone like John to both hold a key fragment and explain to the beneficiaries what Bitcoin is and what their options are. Of course, if you don't go through someone like John, you might not expect them to realize the massive death taxes they'd be liable for in most countries.

From my private discussions with him, John K actually has a lawyer, for in case he goes, the lawyer does the escrow.

For this particular purpose, as soon as you can, educate your children/beneficiaries about bitcoin. Get them to use it. Go buy a ticket from my lotto. Go to bitcoinstore.com and buy a computer. Go to bitstamp to exchange.

Then, once you know they understand about bitcoin, tell them you have a dead man's switch for their current email address with their current GPG key, because you will surely send or compose it encrypted, and/or you have a sealed envelope at your vault just for them containing a cold wallet private key.

They know what to do with it.

That's great if they're older. Mine's two, so being able to put it with someone like John would be a great fail-safe if I die sooner than expected, I think. That kind of demand, too, is never going to dry up, because there'll always be people in similar positions as me. My wife would know what to do, but there's a decent chance we'll die together in our age group.

[psybits]

One simple way is to pass down a physical Bitcoin such as a Casascius coin

Kept in a secret location - only the heir knows.

[jubalix]

You can just write the private key in a letter, and seal the letter and gave it to a lawyer who will give it to your children when you die.

there is no way I would trust a lawyer with this, he opens letter and burns it after. No one would ever know!

Split the private key using Samir's Secret Sharing algorithm and give several trusted parties a fragment. For example, a 3-of-5 scheme where you give a fragment to a spouse, friend, family member, lawyer and bank deposit box. Any 3 fragments can be used to recover the private key. A short instruction on what Bitcoin is and how to use the private key you can spread more liberally to your beneficiaries.

I was actually thinking recently - this would be an interesting place for John K to branch out, and maybe finally form a proper company, since he already holds so much in escrow and has trust established unlike any other member of the community. Since he's quite knowledgeable in Bitcoin, he can offer a Q&A session with family, whereas a letter can't do that and you need to have everything either fully explained to them while you and they are both alive, or a pretty darn good (long) explanation in text.

You would pay someone like John to both hold a key fragment and explain to the beneficiaries what Bitcoin is and what their options are. Of course, if you don't go through someone like John, you might not expect them to realize the massive death taxes they'd be liable for in most countries.

I thought about this as a specific business as well, you need someone/service to be a custodian of the BTC and to explain how to use it, just in case as it is so easy to screw up if you dont know what your doing, and near impossible if you  do and the stakes are high

you need a service that is

trusted
knowledgeable about BTC
legally trained
tax training

anyone want to start this?

for saftey the client should I think use truecrypt key files and only give one to the service A and another to service B or say typical trust / will / lawyer and the encrypted truecrypt container to kids, and lawyers and on the net.

service A would then sit down over for say 1-2 hours a week/fortnight over 2 months and make sure the receiver demonstrated an understanding of bitcoin tech from a private key level, moving bitcoins, dangers of online wallets with examples, exchanges and their risks, tax implications in their jursidiction, and air gaping etc etc, examination, and use cheap coin eg GLD or any other cheap alt to test/teach.

After this the hand over his key file.

[Abdussamad]

See this example:

https://en.bitcoin.it/wiki/Contracts#Example_4:_Using_external_state

[bowen151]

One simple way is to pass down a physical Bitcoin such as a Casascius coin

Kept in a secret location - only the heir knows.

Psybits nailed it.

Leave them a physical bitcoin and a short letter explaining what it is, their journey down the rabbithole will take care of the rest

[Rannasha]

You can just write the private key in a letter, and seal the letter and gave it to a lawyer who will give it to your children when you die.

there is no way I would trust a lawyer with this, he opens letter and burns it after. No one would ever know!

maybe transfer the crypto-coins into real money or assets to leave as an inheritance?   

Again, that's all fine if you know your death is approaching and have time to get your affairs in order, but if you get run over by a bus tomorrow, how are you going to convert your crypto-currency into "real" money (note the quotes, as fiat-money isn't inherently more real than BTC)?

[edmundedgar]

Have the beneficiary make a Bitcoin address by the method of their choice. If you don't want to tell them what it's for yet, tell them you want to give them a birthday present or something.

Make a transaction with a lock time 1 year from now. Email it to the beneficiary, or if you prefer to multiple trusted friends or to the lawyer who would execute your will. Or put it on a public website, it doesn't matter as long as the beneficiary can find it when you die - nobody except the beneficiary can spend it.

Just before the lock time is up, check your pulse to see if you're still alive. If you are, double-spend the transaction to another wallet. Then make a new transaction with the lock time another year in the future. Repeat until dead.

[newguy05]

I am trying to figure out how to pass on bitcoins via trust or will or some other service/instrument.

The problems are multiple

[1] How do you trust some one to do this, they can simply abscond, and it would be hard to track/stop/recover

[2] If the child/beneficiary is not technically good, and can't grasp private keys, and the pitfalls with bitcoin use, and wallets, encryption/duplication and back up of data sets etc

[3] Air gaping etc

I'm sorta thinking that you need a service, that gets one key file for say true a crypt container and another separate organization gets another key file  and both then sends them to the beneficiary and neither organization knows who you gave the other key file to.

then the person can unlock the encrypted file, which you left them on multiple media and cloud etc, and you have to leave detailed instructions and say some GLD coins or cheap coin in a wallet/with private keys as well and tell them to play with that first, back up etc etc

open to ideas

It sorta really important say you get hit by a bus , and don't have this set up, that's its all for nothing.

buy a bunch casascius coins and put it in a bank storage box, then put it in the will instructing the attorney to give the storage box key to the beneficiaries

[marcovaldo]

You can just write the private key in a letter, and seal the letter and gave it to a lawyer who will give it to your children when you die.

there is no way I would trust a lawyer with this, he opens letter and burns it after. No one would ever know!

You can still give it directly to them, and ask them to open it only after you die.