A Canadian Executor’s Guide to Finding, Accessing, and Managing Bitcoin After a Death

When a loved one who owned Bitcoin dies, executors and estate administrators face a unique combination of legal, technical, and security challenges. This guide gives Canadian executors practical, step-by-step advice for locating crypto holdings, dealing with exchanges and custodians, safely accessing keys or wallets, meeting probate requirements, and transferring assets to beneficiaries. It balances legal clarity with hands-on technical steps so you can protect value and reduce risk during a difficult time.

Why Bitcoin Is Different in an Estate

Bitcoin is bearer-based digital property. Possession of the private key means control of the coins. Unlike bank accounts, there is often no central authority that will freely transfer funds without clear legal instructions and proof of identity. Canadian laws around estates, combined with financial regulations such as FINTRAC obligations for exchanges, influence how and when custodians will cooperate. Executors must navigate both the legal process and the cryptographic reality.

First Steps: Locate Documentation and Digital Footprints

Begin with systematic searching. Time is important, but so is caution. Make a checklist and document everything you find.

Physical documents and hardware

• Will, letter of instruction, or password manager with notes about crypto.
• Hardware wallets (Ledger, Trezor, Coldcard), USB drives, paper seed backups, steel seed plates.
• Printed receipts from exchanges, deposit confirmations, or transaction screenshots.

Digital traces

• Check password managers, browser bookmarks, email accounts, and cloud storage for keys, recovery phrases, or exchange correspondence.
• Search for account names on exchanges commonly used in Canada such as Bitbuy or Coinsquare, plus global platforms the deceased may have used.
• Scan phone messages for 2FA setups (SMS, authenticator apps) and any notes about passphrases or multisig co-signers.

If You Find an Exchange Account

Exchanges can hold a large portion of crypto value and require formal legal steps before releasing assets. Expect to provide probate documents and personal identification.

Typical exchange process

• Contact the exchange's estate or legal team. Most platforms will explain the forms and documentation required for a deceased account holder.
• You will likely need a death certificate, a will or grant of probate, and your identification as the executor. Exchanges may also request completed affidavit forms to meet anti-money laundering rules.
• Accounts with large balances or complex histories may trigger enhanced due diligence under FINTRAC obligations, resulting in longer processing times.

Practical tips when dealing with custodial platforms

• Do not request withdrawals until you have documented authority; premature access attempts can complicate legal clearances.
• Keep records of all communications with the exchange, including names, dates, and the content of conversations.
• Be aware that some exchanges may only transfer to accounts in the estate’s name or to a designated cold wallet after receiving appropriate paperwork.

If You Find Hardware Wallets or Seed Phrases

If private keys or hardware wallets are found, technical access is possible but proceed carefully to avoid accidental loss or compromise.

Safe handling checklist

• Record serial numbers and photograph items without revealing seed words.
• Do not input the seed phrase into an internet-connected device. If you must, use an air-gapped computer or a new, offline device using well-known wallet software.
• Consider consulting a trusted, professional crypto recovery service only if you lack internal expertise. Use well-documented providers and get references; avoid handing over seed phrases prematurely.

Recovering a wallet

If you can safely reconstruct a wallet, create a watch-only copy first. A watch-only wallet lets you inspect balances and transactions without exposing spending keys. This helps you plan transfers while preserving the security of private keys.

When Keys Are Lost or Damaged

Missing or damaged keys are common. There are technical and legal routes depending on the situation.

Technical recovery options

• Check for partial backups, BIP39 passphrase hints, or Shamir-split parts across safe places such as safety deposit boxes.
• Recovery tools such as BTCRecover can help reconstruct seeds from partial information. These tools require technical skill and careful handling to avoid exposing secrets.
• If a hardware wallet is damaged, manufacturers may provide recovery instructions if you have the seed phrase. Never provide seeds to untrusted third parties.

Legal options if technical recovery is impossible

• Hire an estate lawyer experienced in crypto. They can advise on disclosure obligations, creditor claims, and potential court orders to compel custodians to cooperate.
• If assets cannot be recovered, document your efforts thoroughly in estate records. That record helps with beneficiary communications and final accounting during probate.

Transferring Bitcoin to Beneficiaries Safely

Once you have legal authority and technical access, plan transfers to minimize risk and tax exposure.

Best-practice transfer steps

• Use a brand-new hardware wallet or a well-audited multisig setup for large transfers to beneficiaries. This avoids reusing potentially compromised addresses.
• Consider staged transfers for large holdings: move small test amounts first to confirm addresses and devices work.
• Document each transfer with transaction IDs, timestamps, and recipient instructions. Keep logs for estate accounting and tax reporting.

Tax and reporting considerations in Canada

Bitcoin is treated as a commodity by the Canada Revenue Agency. The deceased may have capital gains or losses to report up to the date of death. Executors should:

• Work with a tax professional familiar with cryptocurrency to determine tax obligations and required filings.
• Keep transaction history, cost basis records, and any exchange statements handy for the final tax return and possible audits.

Security and Privacy Considerations for Executors

Executors inherit responsibilities that include safeguarding sensitive information. Good operational security protects the estate and reduces the risk of theft or coercion.

Operational security checklist

• Limit knowledge to a small trusted group until assets are secured. Avoid broadcasting that crypto holdings exist.
• Avoid transferring funds to personal accounts. Use estate accounts or appointed cold wallets under the estate's control.
• Beware of scams preying on grieving families: fraudsters may impersonate exchanges, lawyers, or recovery services. Verify identities independently before sharing any information.

Planning Ahead: Advice Executors Can Use for Future Estates

If you are an executor preparing a future-proof plan or advising someone who holds Bitcoin, these practices reduce complexity later.

• Encourage owners to keep a clear letter of instruction for executors that explains where keys are stored, how to access accounts, and named contacts for co-signers or custodians.
• Use multisig and split backups across trusted parties to avoid single points of failure while retaining inheritance access options.
• Store recovery information in multiple secure physical locations such as safety deposit boxes, steel backups, or with a trusted lawyer, and avoid storing full seeds online.

When to Get Professional Help

Complex estates, missing keys, large holdings, or unclear documentation usually require professional help. Consider hiring:

• An estate lawyer with crypto experience to navigate probate and custodian interactions.
• A reputable accountant familiar with cryptocurrency taxation in Canada.
• A trusted, well-documented crypto recovery consultant if technical recovery is required. Insist on written scopes and confidentiality agreements.

Conclusion

Handling Bitcoin in an estate blends legal responsibility with digital security. For Canadian executors, the safest path is systematic documentation, cautious technical handling, and timely legal compliance. Locate records, document actions, work with exchanges correctly, and bring in professionals when needed. With the right process, you can protect value, fulfil fiduciary duties, and transfer crypto assets responsibly to beneficiaries.

Quick checklist for executors: 1) Locate wills and seeds, 2) Inventory devices and exchange accounts, 3) Contact custodians with probate documents, 4) Use watch-only wallets and staged transfers, 5) Document everything and consult professionals.

This guide is educational and does not constitute legal or tax advice. For specific estate or probate concerns in Canada, consult a qualified estate lawyer and a tax professional familiar with cryptocurrency.