by Jake ClaverA major liquidity event, whether from a business sale or a large crypto cash-out, creates decisions that can secure or jeopardize your financial future depending on how deliberately you make them. Whether you plan to sell or hold, here are ten steps worth working through in order.
1. Write a family compass
Before moving money anywhere, define what the wealth is for. A family compass, or family charter, lays out your core values, a mission statement for the money (security, lifestyle, philanthropy, legacy), specific goals, and who’s responsible for what. It keeps later decisions aligned instead of ad hoc, and it heads off the conflict that unstructured wealth tends to create inside families.
2. Talk to a tax professional before you do anything else
A significant crypto liquidity event usually triggers a taxable event. Engage a tax advisor to assess what you owe and where strategies like loss harvesting, charitable contributions, or depreciation might offset gains. Set aside cash for the tax bill before you do anything else with the proceeds.
3. Build a liquidity buffer
Set up an emergency fund covering three to twelve months of living expenses, held in money market or high yield savings accounts, or accessed through a line of credit secured by crypto assets. Resist the urge to make big lifestyle changes, like quitting your job, immediately after a windfall. Give yourself time to build a sustainable plan first.
4. Diversify out of a single asset
Crypto is volatile, so concentration risk is real even after a good outcome. Consider real estate, which offers depreciation strategies, stocks and bonds through ETFs or index funds for stability, and alternative investments like commodities, private equity, or venture capital. A commonly cited rule of thumb, attributed to investor Kevin O’Leary, is to avoid putting more than 20% of your wealth in any one asset class or 5% in a single investment.
5. Decide what to do with the crypto you keep
If you hold rather than sell everything, options include staking for passive income through network validation, DeFi lending or liquidity pools, or simply holding as a long-term, generational asset. Each comes with its own risk profile, and patience through volatility is part of the trade-off.
6. Consider a family office at scale
Once wealth reaches roughly $20 million or more, a family office can consolidate investment strategy, tax and estate planning, and lifestyle management under one roof, which reduces the risk of decisions made in isolation from each other.
7. Protect what you’ve built
Trusts, whether dynasty, spendthrift, or offshore, can shield wealth from creditors and future claims. Institutional custody protects digital assets specifically. Private placement life insurance or additional coverage for digital assets adds another layer. Review the whole structure periodically, since what fit your situation at $2 million doesn’t necessarily fit at $20 million.
8. Build in philanthropy if it matters to you
Donor-advised funds, private foundations, and charitable remainder trusts let you give in a structured way, and most come with tax advantages alongside the impact.
9. Plan the handoff to the next generation
Generation-skipping trusts, life insurance for future generations, and clear governance frameworks for how family wealth gets distributed all reduce the odds that your planning turns into disputes after you’re gone.
10. Keep learning
The rules around digital assets and tax treatment keep changing. Staying current, through conferences, courses, or simply tracking regulatory developments, is part of protecting what you’ve already built, not a separate task.
None of these steps require executing them all in the first month. What matters is acting with intention rather than reflexively, whichever ones apply to your situation first.
Educational only, not tax, legal, or investment advice. Check primary sources and speak with a qualified professional before making financial decisions.
