A will directs who inherits and generally passes through probate. A trust holds assets during your life and passes them outside probate, with privacy and continuity. For digital assets the choice turns on one consideration treated as a preference that is really a security decision: probate makes your asset inventory a public court record, and for a self-custodied holder that is a different exposure than it is for a house.
Part of our guide: Crypto Estate Planning.
The short version
- A will directs. A trust holds. That is the structural difference.
- Probate is public. A court file listing digital assets creates a targeting risk that other asset classes do not carry.
- A trust operates during incapacity as well as death. A will does nothing until you die.
- Neither document conveys access. Both need a separate key succession plan.
- An unfunded trust performs worse than a good will, since it holds nothing while costing more.
What each one actually does
A will appoints a personal representative and directs the distribution of probate property. It takes effect at death, is administered under court supervision in most states, and in the great majority of jurisdictions the file becomes a public record.
A revocable trust is a container. You transfer assets into it during life, you keep control as trustee, and on death or incapacity a successor trustee takes over without a court appointment. It disposes of whatever it actually holds and nothing else.
The pairing most families end up with is both: a funded revocable trust holding the substantial assets, and a pour-over will catching anything that never made it in.
The comparison that matters
Probate. A will goes through it. A funded trust avoids it for the assets it holds. Probate timelines run months and sometimes longer, and during that window nobody has clear authority to act.
Publicity. This is the consideration specific to digital assets and it deserves more weight than it normally gets. A probate inventory is generally available to anyone who asks. A public filing naming a decedent, their address, their heirs, and a substantial digital asset holding is a targeting document. Heirs of publicly documented crypto estates have been approached by people who read the filing, and reported crypto-related fraud complaints and losses have run at historically high levels (FBI Internet Crime Complaint Center). A house cannot be stolen by someone who learns you own it. A wallet is different.
Incapacity. A trust covers it. A will does not operate at all until death, so incapacity has to be handled by a durable power of attorney or not at all. Statistically incapacity is the more likely event in any given year.
Continuity. With a trust, the successor trustee has authority immediately. With a will, there is a gap between death and appointment during which a volatile position sits unattended and nobody can legally act on it.
Cost and effort. A trust costs more to establish and requires the funding step that families skip. A will is cheaper and simpler and buys none of the above.
What neither document does
Neither one hands anybody a private key.
This is the point worth carrying away. A trust can own a wallet in every legal sense while the trustee has no ability to sign a transaction. A will can direct that a bitcoin position pass to a child who then has no path to it. The documents settle entitlement. Capability is a separate design problem that lives in private key succession planning and the letter of instruction.
State law treats the two instruments identically on this question. Where no online tool has been used, the uniform act permits a user to allow or prohibit
“in a will, trust, power of attorney, or other record, disclosure to a fiduciary of some or all of the user’s digital assets”
(Michigan Fiduciary Access to Digital Assets Act, Act 59 of 2016). A will and a trust sit in the same tier. Choosing between them changes probate, privacy, and continuity, and changes nothing about access.
Both documents also share one absolute rule: no seed words, no passphrases, no key material, ever. A probated will is public. A trust is private in practice and can be produced in litigation.
When a will alone is defensible
If holdings are modest, sit with a custodian that supports beneficiary designation, and the family situation is straightforward, a will plus properly set designations plus a durable power of attorney can cover the ground at a fraction of the cost.
Move to a trust when any of these becomes true: the position is large enough that a months-long probate gap is unacceptable, the holdings are self-custodied, privacy matters, there is a blended family or a beneficiary needing structured distributions, or you own real property in more than one state. Personally, in an LLC, or in a trust works through those triggers in more detail.
What I actually see
The trust exists and holds nothing. Drafted well, paid for, never funded, and the pour-over will now sends everything through the exact probate the trust was bought to avoid, with the added cost of having built it. Funding a trust with crypto is the step that gets skipped.
The second pattern is the will that names the asset and cannot deliver it. “I leave my bitcoin to my daughter” is a clear instruction and an empty one if nobody can reach the wallet. The document performs its job perfectly while the outcome fails completely.
The third is the beneficiary designation nobody reconciled. A custodian’s designation form generally controls over both the will and the trust for that account. I have seen a carefully built trust bypassed entirely by a field somebody filled in during onboarding and forgot.
The check worth running: read the will, the trust, and every custodian designation in one sitting and ask whether all three describe the same outcome. That review costs an hour and finds the contradictions that otherwise surface during administration.
Where this goes wrong
The choice gets made and the follow-through does not.
The specific failures: a trust that was never funded. Key material written into a will that becomes public. Beneficiary designations contradicting the estate documents. No durable power of attorney, so incapacity has no answer. A successor trustee who is technically unable to administer digital assets and was never asked. And a will that lists assets in detail, converting the probate file into an inventory for anyone who reads it.
The decision rule
- Inventory what you hold and where it sits, because the answer depends on it.
- Decide whether the probate gap is acceptable for the largest position.
- Weigh publicity as a security question, particularly for self-custodied holdings.
- Handle incapacity explicitly, with a trust or a durable power of attorney that names digital assets.
- If you build a trust, fund it, and keep the record that shows you did.
- Reconcile every beneficiary designation with whichever document you intend to control.
- Keep all key material out of both documents, permanently.
- Build the access plan separately, since neither instrument provides one.
Where this sits
This choice sits at the top of the estate layer and touches everything under it. Estate planning covers the full picture. Trusts covers the instrument in depth. Custody covers whether the fiduciary can reach anything either document governs.
The families that get this right treat it as one review rather than three appointments. The estate attorney drafts, the CPA models the tax and basis, and somebody has to confirm that the custody arrangement, the designations, and the documents all describe the same assets. When that final check has no owner, it is the one that gets skipped, and it is the one that decides whether any of the rest works.
Sources
- Revised Uniform Fiduciary Access to Digital Assets Act (Uniform Law Commission)
- Michigan Fiduciary Access to Digital Assets Act, Act 59 of 2016
- Wyoming Uniform Trust Code, Wyo. Stat. Ann. Title 4, Chapter 10 (Wyoming Legislature)
- IRS, About Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return
- IRS, Digital assets
- FBI Internet Crime Complaint Center
Related
- Crypto estate planning for high-net-worth families
- How to fund a trust with crypto
- Can a trust hold Bitcoin, Ethereum, or other digital assets?
- What is a digital asset letter of instruction?
- Common crypto estate planning mistakes
Last updated: 3 August 2026.
This article is general education, not legal, tax, or investment advice. Probate procedure and digital asset access law vary by state. Talk to a qualified estate attorney about your own situation.
