How to Pass Bitcoin to Family — Step by Step

The Challenge

Passing Bitcoin to your family sounds simple. In practice, it is one of the most technically demanding aspects of cryptocurrency ownership. You need to solve three problems simultaneously:

Your family must be able to access your Bitcoin after you die
Nobody should be able to access your Bitcoin while you are alive (without your consent)
Your family members may have no understanding of how cryptocurrency works

This guide provides a practical, step-by-step approach to solving all three.

Step 1: Create a Recovery Pack

A recovery pack is a set of documents and materials that contains everything someone needs to access your Bitcoin. Think of it as an instruction manual for your digital estate.

Your recovery pack should include:

An inventory document listing:

All cryptocurrency holdings and approximate amounts
Where each asset is held (exchange name, wallet type, device)
Account email addresses and usernames
Whether 2FA is enabled and the method (authenticator app, SMS, hardware key)

Step-by-step recovery instructions written for a non-technical reader:

How to access each wallet or exchange account
How to verify balances
How to transfer funds to a new wallet or sell to fiat currency
Who to contact for help (trusted friend, solicitor, crypto-literate adviser)

A reference sheet explaining basic terminology:

What a wallet is
What a seed phrase is and why it matters
What a private key is
The difference between Bitcoin on an exchange and Bitcoin in self-custody

Write everything as if you are writing for someone who has never touched cryptocurrency. Use plain language. Include screenshots if possible. The person reading these instructions will be grieving and likely overwhelmed — clarity is kindness.

Step 2: Secure Your Seed Phrase Separately

Your seed phrase is the single most important piece of information in your recovery pack — but it should not be stored with the rest of the pack. If someone finds the recovery pack and the seed phrase together, they have everything they need to take your Bitcoin.

Store the seed phrase separately using one of these methods:

Metal backup in a secure location. Engrave or stamp your seed phrase onto a metal plate (steel or titanium). Store it in a fireproof safe, a bank safe deposit box, or another physically secure location. The recovery pack should say where the metal backup is and how to access it — but the seed phrase itself is stored elsewhere.

Shamir’s Secret Sharing. Split the seed phrase into multiple shares (for example, 3 of 5). Distribute the shares to different trusted people or locations. The recovery pack explains that the shares exist, who holds them, and how to combine them.

Multi-signature wallet. Use a wallet that requires multiple keys to authorise a transaction. Distribute keys to different parties. The recovery pack lists the key holders and explains the process for signing a transaction.

Step 3: Choose Trusted Contacts

Identify 2-3 people who will play a role in your Bitcoin recovery plan. These should be people you trust absolutely — because they will ultimately have access to your funds.

Consider:

A technically capable friend or family member who can follow the recovery instructions and handle the actual transfer of funds
A solicitor who holds part of the recovery information (such as one share of a split seed phrase or a sealed envelope to be opened on death)
A secondary contact in case the primary contact is unavailable

Brief each person on their role. They do not need to understand Bitcoin in detail, but they need to know:

That you hold cryptocurrency
That they have been designated as part of the recovery plan
Where to find the recovery pack or their specific share of information
That they should not act until the appropriate time

Step 4: Set Up a Dead Man’s Switch (Optional)

A dead man’s switch is a mechanism that triggers automatically if you fail to respond within a set period. For Bitcoin inheritance, this can be useful as a backup notification system.

Options include:

Google Inactive Account Manager — sends a notification to designated contacts if your Google account is inactive for a defined period (1-18 months). You can also share specific data.
Encrypted email services — some services allow you to compose an email that is sent automatically after a period of inactivity
Time-locked Bitcoin transactions — advanced users can create transactions with a time-lock that only becomes valid after a certain block height or date

Dead man’s switches are a supplement, not a replacement, for a proper recovery plan.

Step 5: Run a Practice Session

This is the step that most people skip — and the one that makes the biggest difference. Before you consider your plan complete, run a practice session with your primary heir or trusted contact.

Give them the recovery pack (or a redacted version) and ask them to walk through the steps. Watch where they get confused. Note the questions they ask. Update the instructions based on their feedback.

A plan that makes perfect sense to you may be completely opaque to someone with no crypto experience. The only way to know is to test it.

If a full practice session is not possible, at minimum sit down with your heir and explain:

That you own Bitcoin
Roughly how much (they need to know the stakes to take this seriously)
Where the recovery pack is located
Who the other trusted contacts are
That they should not attempt anything without reading the full instructions first

Step 6: Store the Recovery Pack

The recovery pack should be stored in a location that is:

Accessible after your death — not on your password-protected laptop or in an encrypted cloud drive that nobody else can access
Secure during your lifetime — not sitting on the kitchen table
Fireproof and waterproof — or at least stored in a location that mitigates these risks

Good options include:

A fireproof safe at home (share the combination with your executor)
A sealed envelope held by your solicitor
A bank safe deposit box (ensure your executor can access it)
Multiple copies in different secure locations

Step 7: Maintain and Update

Your recovery plan is a living document. Update it:

When you buy or sell significant amounts of crypto
When you change wallets, exchanges, or security setups
When your trusted contacts change (new executor, family changes)
At least once a year, even if nothing has changed — to confirm everything is still accurate

Set a calendar reminder. The cost of an outdated plan is the same as the cost of no plan: your family cannot access your Bitcoin.

Summary

Passing Bitcoin to your family requires deliberate effort. The technology that protects your Bitcoin from theft is the same technology that can lock your family out permanently. By creating a recovery pack, securing your seed phrase, briefing trusted contacts, and testing your plan, you transform cryptocurrency from a potential burden into a genuine inheritance.

The best time to start is now. The second best time is also now.

Seed Phrase Inheritance — Secure methods for storing and passing on your recovery phrase.
Multi-Sig Inheritance Explained — How multi-signature wallets eliminate single points of failure.
What Happens to Bitcoin When You Die? — The fundamental problem this guide helps you solve.
James Howells: $500M Buried in a Landfill — Why physical security matters as much as digital security.
Clifton Collins: 6,000 BTC Hidden in a Fishing Rod — A fortune lost because keys were stored in a single location.

How to Pass Bitcoin to Your Family