How to Inherit an Investment Portfolio: Cryptocurrency, Stocks and Other Assets

The topic of inheritance of an investment portfolio is, unfortunately, often ignored. This causes not only serious legal problems for heirs or family disputes, but sometimes also leads to the complete loss of assets. To analyze all aspects of this topic, we turned to several experts for comments.

Volodymyr Sytnik, a lawyer at “Prime” Law Firm and K.A.C. Group, explained in a comment to PaySpace Magazine that inheritance, in general, is a complex and multifaceted process that requires careful preparation, especially when it comes to an investment portfolio. It can include stocks, bonds, shares in the authorized capital of companies, units in investment funds or even assets on foreign exchanges. Each of them has its own legal, economic, procedural subtleties that can create difficulties for heirs.

Lawyer Viktoriia Shavhulidze noted that when it comes to cryptocurrency or an investment portfolio, most people focus on profitability, risks, and diversification. However, almost no one plans what will happen to assets after their death. This is not the most popular topic, but in the case of digital assets, ignoring it often leads to the loss of all capital – irretrievably.

One example is the death of the CEO of the crypto exchange QuadrigaCX, who did not transfer access to a cold wallet to anyone. About $190 million was frozen forever. But such stories happen not only with big players. The Reddit crypto community has repeatedly discussed cases when relatives found a Ledger hardware wallet or a piece of paper with a seed phrase, not understanding what it was at all. Or they found nothing – just an address with millions, to which no one else has the key.

Another resonant example, the QuadrigaCX case, was cited by Petro Bilyk, partner in the technology and investment practice, head of the AI ​​practice at “Juscutum” Law Firm.

“After the unexpected death of the exchange founder, about $190 million in virtual assets became permanently inaccessible due to the loss of private keys. Such examples highlight the critical importance of careful estate planning and secure asset access management.”

Viktoriia Kostenko, civil and family law attorney at “PROCTOR” Law Firm, said that inheriting an investment portfolio can be accompanied by a number of problems, including:

• lack of access to digital assets (if the cryptocurrency owner did not leave the heirs access keys, passwords, or seed phrase to restore access to the wallet);

• lack of clear regulation of the crypto sector in Ukraine (in particular, inherited property is subject to assessment, and the mechanism for assessing crypto currencies is not yet regulated in our country);

• the legal norms that regulate the inheritance process are contained, in particular, in the Civil Code of Ukraine, the Law of Ukraine “On Notaries”, the Procedure for Performing Notarial Actions, but no algorithm for actions with digital assets as an inheritance is provided by them.

What options for transferring an investment portfolio are available, and what steps need to be taken so that the heirs do not have problems when receiving assets as an inheritance?

As Viktoriia Kostenko explained, the inheritance includes all rights and obligations that belonged to the testator at the time of opening the inheritance and did not cease due to his death – this is determined by Article 1218 of the Civil Code of Ukraine. There are 2 ways to receive an inheritance – by will and by law.

If there is a will, everything is clear here (the heir made a decision in the event of death) and the advice is to indicate in detail what assets are being transferred, their location, all identifying features, access instructions, complete data about the heir.

If there is no will, the closest relatives inherit in the order of priority determined by the Civil Code of Ukraine, usually by contacting a notary. All disputes regarding the order of succession, terms of acceptance of inheritance, lack of documents on inherited property, controversial issues regarding securities, lack of documents confirming ownership are resolved in court.

“Therefore, shares are inherited as objects of civil rights according to the general rule in one of the two above-mentioned ways. And here the question arises: what should do with digital assets if the crypto currency market is not regulated in Ukraine at the legislative level?” said the PROCTOR civil and family law lawyer.

Volodymyr Sytnik added that drawing up a will is the easiest way to leave a portfolio as an inheritance. One or more persons may be appointed as heirs, regardless of the presence of family or kinship ties with them. At the same time, it is worth considering the right to a mandatory share in the inheritance. There are certain categories of persons who inherit part of the inheritance regardless of whether they are indicated in the will.

“According to Ukrainian legislation, such persons include minors, minors, adult disabled children of the testator, disabled widow (widower) and disabled parents. In the event of a will in which they are not included, they will inherit half of the share that would belong to each of them in the event of inheritance by law,” noted the K.A.C. Group lawyer.

Petro Bilyk explained that the inheritance procedure involves compliance with established legislative norms, in particular Chapters 84-87 of the Civil Code.

“In Ukraine, virtual assets are recognized as objects of civil rights in accordance with Article 179-1 of the Civil Code of Ukraine. In practice, this means that a person may dispose of them, as well as any other assets, including passing them on as an inheritance. Transactions with securities are provided for by the Law of Ukraine “On Capital Markets and Organized Commodity Markets”. When inheriting corporate rights to companies, you should take into account corporate legislation, such as the Law of Ukraine “On Limited and Additional Liability Companies”, a partner in the technology and investment practice, head of the AI ​​practice at Juscutum commented.

Viktoriia Shavhulidze also emphasized that simply including crypto assets in a will without technical support is not enough. It is necessary to fix the storage location, access to keys, instructions for heirs, ideally, through a trustee, multi-signature, smart contract or a service like Safe Haven.

“For companies and startups, it is worth considering such scenarios at the stage of registration of corporate rights. Internal documents should determine what will happen to the founder’s share in the event of his death, who will receive control, whether there is a right of redemption. Otherwise, even a small share can block the company’s activities,” the lawyer explained.

Experts noted that if assets are stored on a crypto exchange, one can use special offers, for example, the Legacy Inheritance (Inheritance Appeal) tool, in the case of Binance. It allows heirs to submit a request directly through Customer Support in the client portal. After initiating the procedure, a special Binance team checks the submitted documents and confirms the right of the heirs.

“In this case, the heirs shall prepare and upload a notarized and apostilled translation of the death certificate, a notarized translation of the certificate of the right to inheritance, a notarized passport. In case of securities, these documents must be notarized translations of documents with an apostille to ensure recognition in a foreign jurisdiction. If the jurisdiction of registration of the crypto exchange is not a party to the Hague Convention, a full legalization procedure will be required,” said Petro Bilyk.

One can also consider options for transferring assets through a trust or other legal structures that will ensure continuity of asset management after the death of the owner, explains Viktoriia Kostenko. Trusts are predominantly Western practice, they are a classic tool for estate planning in Anglo-Saxon legal systems (for example, in the UK or the USA).

In Ukraine, trusts as a separate legal form are not enshrined in legislation. However, a similar function can be implemented in other ways, for instance, through a property management agreement. The owner of the assets transfers the right to manage to a certain person (manager), who, under certain conditions, transfers the property to the beneficiaries – heirs. Such an agreement may provide for specific scenarios in the event of death.

“There is also an option to establish a private enterprise or fund. The owner creates a legal entity that owns an investment portfolio. The rules for transferring rights in the event of his death are determined through the charter or corporate agreement,” adds the civil and family law lawyer of the “PROCTOR” Law Firm. “Otherwise, one may consider the use of foreign trusts. If a person has access to a foreign jurisdiction (for example, citizenship or a bank account), they can create a trust under the laws of another country. Such an instrument provides more flexibility, but requires the support of lawyers who understand both Ukrainian and international law.”

Do you need to pay taxes on inheritance in the form of crypto or shares?

As Viktoriia Shavhulidze noted, inheritance in Ukraine is taxed in accordance with the Tax Code. If both the testator and the heir are residents of Ukraine, the heirs of the first and second degree of kinship (children, parents, siblings, grandparents, grandchildren) shall not pay personal income tax (PIT) and military levy.

Other heirs (such as friends, civil partners, colleagues) shall pay 5% PIT and 5% military levy. If at least one of the parties is a non-resident, the tax burden increases to 18% PIT + 5% military levy. Moreover, the responsibility for calculating and paying taxes lies entirely with the heir.

Petro Bilyk adds that it is better to have asset valuation reports so that the notary can immediately determine the tax base and determine whether a zero or preferential rate is applied.

“Calculation is more difficult with assets located abroad. For example, an inheritance of US assets (stocks, ETFs, cash in dollars, etc.) of more than $60,000 may be taxed at a rate of 18-40% depending on the size of the portfolio,” the expert explained. According to him, in order to legally optimize the tax burden, it is worth engaging in tax planning, structuring assets through family offices, trusts and separate SPV companies.

Experts’ advice

Volodymyr Sytnik explains that investors can pay attention to the inheritance agreement as a flexible tool that allows not only to clearly determine the fate of the property, but also to ensure the fulfillment of the will of the testator during his lifetime.

“Despite its name, the inheritance agreement is an institution of obligation, not inheritance law. This is an agreement under which one party (the acquirer) undertakes to carry out the instructions of the other party (the alienator), and after his death acquires ownership of his property,” the lawyer says.

Simply put, the owner of the property decides what the other party should do (for example, take care of him, financially support him, carry out certain instructions). The acquirer agrees to fulfill these conditions and after the death of the alienator, the property passes into his ownership without the standard inheritance procedure (without submitting an application to a notary about accepting the inheritance and waiting 6 months).

For her part, Viktoriia Kostenko noted in a comment to PSM: “It is unlikely that litigation will be avoided in the future due to the lack of legal regulation of the issue, but in order to minimize risks, the advice is to be ahead of the game and transfer information about the availability of crypto currency during your lifetime.”

In other words, one should transfer passwords, private keys, seed phrases, information about monetary transactions carried out using crypto wallets, information about exchanges.

Viktoriia Shavhulidze added that if one wants to transfer crypto currency to their heirs, it is necessary to structure it as a project: describe the assets, record the method of access, and provide a legal mechanism for transfer.

“A crypto account is not a bank account. There will be no certificate, password recovery, or “support service.” If access is lost, that’s it. Therefore, simply writing the key on a piece of paper hidden somewhere in a book is a risky path,” the lawyer emphasized.

According to Petro Bilyk, a modern Ukrainian investor owns a hybrid portfolio of assets that combines both tokenized assets and shares in foreign companies. To guarantee the smooth transfer of such capital to the next generation, it is necessary to integrate two interconnected blocks of measures, namely a clear legal structure and reliable technological procedures for the implementation of inheritance rights to virtual assets.

“First of all, it is critically important to draw up a will that takes into account all asset classes, from real estate and deposit accounts to crypto wallets and securities. It is worth adding a power of attorney to the will with a detailed list of the functions of the authorized person (tax planning, re-registration of corporate rights, execution of procedures),” says the partner of the technology and investment practice, head of the AI ​​practice at Juscutum.

Secondly, the specialist continued, for virtual assets, it is necessary to provide for the implementation of technological mechanisms of inheritance: the configuration of a multi-signature wallet with a flexible quorum of signatories over time. Each tool should be accompanied by detailed documentation for the heirs on how to access it after the smart contract is triggered.

“The combination of these two components – legal architecture and the procedures built into the digital foundation – will minimize risks, reduce time and ensure that each heir will receive their legal right to capital in the shortest possible time. The sooner you integrate these solutions, the lower the risk of losing assets,” explained Petro Bilyk.

What rules for inheritance of crypto currencies may appear in Ukraine?

Viktoriia Shavhulidze notes that from a legal point of view, crypto in Ukraine remains in a gray area. The Law “On Virtual Assets” was adopted back in 2021, but as of 2025 it has not yet entered into force, as it requires coordination with tax legislation.

At the same time, this law has the potential to create clear rules for the inheritance of digital assets. In particular, it establishes that:

• ownership of a virtual asset arises as a result of the creation of an asset, the conclusion or execution of a • • transaction, in accordance with the provisions of the law or a court decision, and is certified by possession of a key;

• algorithms and functions of blockchain systems may record the conditions of acquisition, transfer and the scope of rights to an asset;

• the owner of the key is the owner of the virtual asset, except in cases of storage by third parties or illegal receipt;

• in the absence of a different court decision, possession of the key is sufficient confirmation of ownership;

• ownership includes possession, use and disposal, including transfer;

• all these actions are recorded in the system for ensuring the turnover of virtual assets.

“That is, in the future, these principles may become the legal basis for the legitimate transfer of crypto as an inheritance. Nonetheless, until the law comes into force, such assets are transferred in the general order of inheritance, and each case must be worked out individually with a lawyer,” added Viktoriia Shavhulidze.

Corporate rights and securities

According to Petro Bilyk, the inheritance of shares and corporate rights also includes certain legal formalities. Shares of a company can be inherited without the need for the consent of other participants, however, the charter or corporate agreement of the LLC may contain other provisions or require holding a general meeting of participants and amendments to the charter. It may also be provided for the obligation to sell corporate rights in the event of the death of a participant to other participants, i.e. the heir will receive the value of the company’s share, and not the share itself. As such, both the LLC participants and the heirs need to think about this in advance.

“In Ukraine, it is somewhat simpler in case of securities; they are inherited by opening an inheritance case and re-registering an account with a depository institution: the heir submits a certificate of the right to inheritance, a copy of the agreement on the division of inherited property (if any), a passport, and information about the details of the heir’s securities account, to which the rights to the inherited shares must be transferred. After that, the registrar makes changes to the depository,” says the Juscutum expert.

He also mentions that many Ukrainians have accounts with Interactive Brokers or foreign brokers. Interactive Brokers offers the Transfer on Death (TOD) function, which allows the account owner to automatically transfer assets to designated beneficiaries, but the problem is that this function has limitations: for example, it is available only for American individual accounts. For clients from Ukraine (as well as other non-US residents), the TOD option is not available: after the owner’s death, the account is automatically blocked until the legal rights of the heirs are established.

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