If heirs find a hardware wallet, leave it exactly as you found it and make no attempt to open it until somebody with legal authority is involved. Most permanent losses in this situation happen in the first hour, and they are caused by the family trying to help. The device is designed to destroy its own contents when someone guesses wrong, and it cannot tell the difference between a thief and a grieving son working through birthdays.
Part of our guide: Crypto Estate Planning.
The short version
- Enter nothing on the hardware wallet. Wrong PIN attempts can wipe the device permanently.
- Change nothing. Do not reset, update firmware, or connect it to an unfamiliar computer.
- Photograph and record it where it sits, then secure it.
- Establish who has legal authority before anyone touches it.
- Search for the recovery words separately. They matter more than the device.
The first hour
Stop. In the first hour after finding the wallet, set the device down. Nothing about this situation improves with speed, and several things get permanently worse.
Record the scene. Photograph the device, any labels, serial numbers, cables, and anything stored with it: envelopes, cards, metal plates, handwritten notes. Note exactly where each item was found. Do this before moving anything, because the arrangement itself is often the only surviving instruction.
Secure everything in one place, ideally a safe or a bank box under the estate’s control, and record who has access to it.
Establish authority. Nobody should act on estate property before it is clear who is legally entitled to. That is the executor named in the will and appointed by the court, the successor trustee if a trust owns the asset, or an agent under a power of attorney if the owner is alive but incapacitated. Acting first and asking later creates personal exposure for the person who acted.
Make one call before anything else, to the estate attorney. If the family does not have one, that is the appointment to make this week.
Why guessing is the thing that ends it
Hardware wallets erase their key material after a set number of incorrect PIN entries. This is deliberate and it is what makes a stolen device safe. It also means the family has a small, fixed number of attempts before the contents are gone.
The recovery words can restore a wiped device onto new hardware. Without them, the wipe is final. So the sequence matters enormously: find the words first, then consider the device. A family that searches for the recovery material before experimenting keeps every option open. A family that experiments first may have no options at all.
Firmware updates and factory resets carry the same risk and are often suggested by well-meaning general troubleshooting advice. None of that advice was written for a situation where the owner cannot be asked what happens next.
There is also no institution to fall back on. State digital asset access law works entirely through custodians, defined as
“a person that carries, maintains, processes, receives or stores a digital asset of a user”
(NRS 722.090). A device in a drawer has none. There is nobody to serve with letters testamentary and no disclosure obligation for anyone to satisfy, which is why the search for written material matters more here than any legal step.
What the device can and cannot tell you
Even opened, a hardware wallet is a signing tool rather than a ledger. It does not hold a transaction history in any usable form and it will not produce a statement.
What the estate actually needs, it will have to assemble elsewhere: the addresses, the balances at date of death, the acquisition history, and the cost basis. That comes from wallet software, block explorers once addresses are known, exchange records, and the deceased’s own files.
There may also be more than one wallet. Finding a device with a modest balance is not evidence that the search is over, and a passphrase feature can hide a second wallet behind the same recovery words. A balance that looks small is a reason to keep looking rather than a conclusion.
What to look for while you wait
The hardware wallet is one item. While you wait for legal authority, these matter as much or more.
Recovery material, meaning twelve or twenty-four handwritten words, often on a card that came with the device or on a metal plate. Frequently in a safe, a bank box, or with a family member. Anyone who holds these words holds the assets, so treat them as you would bearer certificates.
A letter of instruction or any handwritten note listing accounts, wallets, or contacts.
Estate documents, since they determine who may act.
Tax records, which the estate will need for basis. This is usually the hardest thing to reconstruct and the easiest thing to discard by mistake.
Exchange and custodian statements, which reveal accounts nobody knew about.
The professionals: attorney, CPA, and anyone the deceased spoke to about digital assets.
What I actually see
Somebody tries the PIN. It is nearly always a family member acting from good motives during a week of high stress, and it is the single most destructive thing that happens in these situations. The instinct to resolve uncertainty by testing it is exactly wrong here.
The second pattern is the recovery card that got thrown out. It looks like packaging. It is often in an envelope with the manual and the box, and during the clearing of a house it goes in a bag with everything else. I would tell any family clearing a home to set aside every handwritten list of words, however meaningless it appears.
The third is authority claimed casually. A relative takes the device home for safekeeping before anyone is appointed. However well intended, it puts estate property in the hands of someone with no standing, and if value goes missing afterward there is no clean account of who held what.
Where this goes wrong
The family treats the device as a puzzle to solve rather than estate property to preserve.
The specific failures: PIN attempts that wipe the device. A factory reset performed to “start fresh.” Recovery words discarded with packaging. Photographs of the recovery card sent over messaging apps, which publishes the words to whatever service carries them. The device connected to an unknown computer or a downloaded tool, which is how these situations become theft. One person taking custody with no record. And a search that stops at the first device found.
The decision rule
- Touch nothing beyond securing the device.
- Photograph and record the device and everything stored with it, in place.
- Secure all of it together under the estate’s control, with a written record of who has access.
- Establish legal authority before any attempt to access anything.
- Call the estate attorney, and involve someone with digital asset experience before the device is opened.
- Search for recovery material and tax records, treating the words as bearer instruments.
- Assume there is more, and keep looking after the first wallet is found.
- Document every step, since the estate will have to account for all of it later.
Where this sits
A hardware wallet found by heirs is the emergency version of a question better answered in advance. Hardware wallet estate planning covers what the owner should have documented. Seed phrase storage covers the material you are now searching for. Estate planning covers the whole arrangement.
If you are reading this because it has already happened, the useful next step is a single conversation that includes the estate attorney, whoever will handle the tax reporting, and someone who works with digital asset custody. These three questions, meaning authority, access, and basis, get answered badly when they are asked separately, and this is the situation where asking them separately costs the most.
Sources
- Nevada Revised Statutes Chapter 722, Fiduciary Access to Digital Assets (Nevada Legislature)
- Michigan Fiduciary Access to Digital Assets Act, Act 59 of 2016
- Revised Uniform Fiduciary Access to Digital Assets Act (Uniform Law Commission)
- IRS, Digital assets
- IRS, About Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return
- FBI Internet Crime Complaint Center
Related
- Hardware wallet estate planning
- Seed phrase storage for estate planning
- What is a digital asset letter of instruction?
- Private key succession planning
- Crypto estate planning for high-net-worth families
Last updated: 3 August 2026.
This article is general education, not legal, tax, or investment advice. Fiduciary authority and digital asset access law vary by state. Talk to a qualified estate attorney about your own situation.
