Brandon Avergon spent years working with the Rockefeller Global Family Office and other ultra-wealthy families, and he’s watched what happens when people build serious wealth but skip estate planning. The numbers are not forgiving: a 40% federal estate tax, state taxes that can add another 16% on top, creditors with claims on everything you own, and families stuck in probate while assets get liquidated just to cover bills.
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Why crypto holders face a sharper version of this problem
For people holding digital assets, the stakes are higher because the asset class is newer and the planning tools around it are less standardized. Brandon’s conversation centered on private placement life insurance (PPLI), which has become a go-to structure for crypto holders looking for tax-deferred growth, asset protection, and a way to pass wealth to the next generation without estate taxes eating a huge share of it.
PPLI works by holding investment assets, including digital assets under the right custody arrangements, inside a life insurance policy wrapper. Growth inside the policy is tax-deferred, and under the right structure, policyholders can access cash without triggering a taxable event.
The investor control doctrine is the landmine
One detail that gets glossed over: the investor control doctrine. If a policyholder exercises too much direct control over the specific investments inside the policy, the IRS can disregard the insurance wrapper entirely and tax the gains as if the policyholder owned the assets directly. That risk is exactly why compliant custody and proper structuring for digital assets inside these policies matters so much. Get it wrong and the entire tax advantage of the structure can unravel.
Onshore versus offshore, and why funding strategy matters
Onshore and offshore PPLI differ in cost, minimum investment, and flexibility, and the right choice depends on the size of the estate and the client’s goals. Brandon also emphasized that how a policy gets funded, not just which jurisdiction it’s set up in, has a major effect on whether the structure actually delivers the tax and liquidity benefits it’s designed for.
The lesson from two family fortunes
Both the Vanderbilts and the Rockefellers built massive fortunes. Only one family still has theirs today, and the difference largely came down to estate planning. If you’re sitting on meaningful crypto gains and haven’t thought through what happens to that wealth when you’re gone, that’s the gap worth closing now, while you still have every option on the table. You can find Brandon at offshoreppli.com, and the tax treatment of digital assets is laid out directly by the IRS.
Educational only, not tax, legal, or investment advice. Check primary sources and speak with a qualified professional before making financial decisions.
Part of our guide: Crypto Estate Planning.
