The Property (Digital Assets) Act 2025: What It Means for Your Estate

On 2 December 2025, the Property (Digital Assets etc) Act 2025 received Royal Assent. It's a short piece of legislation. Only a handful of clauses. But it settles something that's been nagging at English and Welsh law for years: can you actually own a Bitcoin the way you own a car or a savings account?

The answer is yes. Finally and officially, yes.

I've got to be honest, I think we needed this law about three years earlier than we got it. The UK is now among the first countries to formally put crypto, NFTs and other digital tokens on a statutory footing as personal property. That sounds dry. It isn't. Because until this Act passed, the legal status of these assets was genuinely murky, and that murkiness was causing real headaches for real families trying to sort out estates that included crypto.

I've followed this area closely for a long time. And in my view, this is probably the most significant shift in English property law in a generation. Not because it invents new rights from nothing. But because it clears out a fog of doubt that was making estate planning for digital assets far harder than it had any business being.

English property law is old. I mean properly old. And for centuries it only recognised two categories of personal property.

The first: "things in possession." Physical stuff you can touch and carry. A car, a painting, a gold coin, a box of family photos. If you can pick it up and walk off with it, it lives here.

The second: "things in action." Rights you enforce through legal proceedings. A debt owed to you, shares in a company, intellectual property, a bank balance. You can't hold a debt in your hand, but the law says it's yours and gives you ways to chase it.

Now here's where crypto fell through the cracks. You can't hold a Bitcoin. So it's not a thing in possession. But nobody owes you anything either, so it doesn't really behave like a thing in action. A Bitcoin is a cryptographic entry on a distributed ledger, controlled by whoever has the private key. It just... doesn't fit. The whole framework was built for a world of land deeds and promissory notes, and crypto arrived and sat down in a chair that didn't exist.

Courts in England and Wales had been treating crypto as property in one-off cases. Mostly in fraud judgments and asset-freezing orders where judges needed it to be property so they could actually issue injunctions. The Law Commission published a chunky consultation paper in 2023 recommending a new, third category of personal property. Good. But until Parliament got round to legislating, the position was technically up in the air.

For estate planning, that grey area had teeth. Could a Will validly gift a Bitcoin? Almost certainly, most practitioners thought so. But "almost certainly" is not "definitely." Not when a family is grieving and an executor is trying to do the right thing under pressure. Could crypto sit in a trust? Probably. Was there any risk a beneficiary could challenge a crypto gift? Small, but not zero. The law was stumbling along on case-by-case judicial improvisation, and that is never a comfortable place to park your family's finances.

The Act does something I find rather elegant, actually. It confirms that a thing is not prevented from being the object of personal property rights merely because it is neither a thing in possession nor a thing in action.

Worth reading that twice, because the phrasing is doing a lot of heavy lifting. The Act doesn't try to list every type of digital asset. It doesn't name Bitcoin or Ethereum specifically. What it does is carve out space for a third category of personal property. Things that aren't physical objects and aren't traditional legal rights, but that you can still own, transfer, inherit and enforce.

This third bucket catches cryptocurrency, NFTs, carbon credits on a blockchain, and potentially other digital constructs that haven't been invented yet. The drafting is deliberately technology-neutral, and I think that was the right call. Actually, I think it was the only sensible call. The last thing anyone wants is legislation that goes stale the moment someone dreams up a new kind of token.

So what does it mean in practice? Digital assets in this third category now sit on the same legal footing as any other personal property. They can be gifted in a Will. Held on trust. Subject to court orders. Valued and taxed. None of those things were impossible before, to be fair. But all of them were arguable. And in law? Arguable means expensive. It means uncertain. It means families spending money on lawyers to fight over something that should have been straightforward.

For the UK, this is a statement of intent. It puts us alongside jurisdictions like Liechtenstein and Wyoming that had already legislated, and arguably ahead of most of the EU, where the position is still a patchwork across member states.

If you hold crypto, NFTs, or other blockchain-based assets, the Act firms up your ability to deal with them in your Will. Properly and confidently.

Before the Act, a well-drafted Will could almost certainly gift crypto without trouble. Solicitors and estate planners were already doing it, and I never seriously thought the courts would refuse to uphold those gifts if tested. But "almost certainly" carried a sliver of legal risk. Some people found that uncomfortable, and honestly, I don't blame them. That sliver is now gone. The Act says digital assets are property. Property can be gifted by Will. The logic chain is complete and statutory.

Here's the bit that trips people up though. And I want to be blunt about it.

Digital assets don't automatically fall under a general "personal possessions" clause in your Will.

Loads of Wills include a standard clause leaving "all my personal possessions" to a spouse or partner. That phrase has an established meaning in probate law, and it generally refers to tangible, physical stuff. Furniture. Jewellery. Clothing. Vehicles. A court looking at "personal possessions" is very unlikely to read it as covering a crypto wallet with tens of thousands of pounds in it. Or an NFT collection. Or a stack of digital tokens.

So if your Will doesn't specifically mention digital assets, they'll fall into the residuary estate. That's whatever is left after the specific gifts have been handed out. Maybe that's fine. Maybe your residuary beneficiaries are exactly who you'd want to get the crypto anyway. But if you had a particular person in mind, and you were relying on "personal possessions" to make it happen? That's not going to work. The Act hasn't changed this and it was never going to.

The practical point is simple. If you hold digital assets worth anything meaningful, your Will needs a clause that says so. It doesn't need to be complicated. Something along the lines of "I give all my cryptocurrency holdings, digital tokens and blockchain-based assets to [name]" is a reasonable starting point. The exact wording should fit your circumstances.

And while you're at it, think about whether your executors even know these assets exist. Where they're held. How to get at them. A Will clause is only as useful as the executor's ability to act on it, and digital assets have an awful habit of vanishing forever if nobody knows where the keys are.

The Act doesn't just matter for people writing Wills. It also sharpens things for the people who have to carry them out.

Executors have a legal duty to identify, collect, value and distribute everything in the estate. That duty always covered digital assets in practice. But the Act's formal recognition of crypto and tokens as property makes it black and white. An executor who overlooks digital holdings, or who doesn't bother to make reasonable enquiries about them, is on shaky ground if a beneficiary later turns up assets that were missed.

This matters because digital assets are invisible in a way that other property isn't. A house shows up on the Land Registry. A bank account generates post. Shares appear on a platform statement. But a hardware wallet sitting in a desk drawer? It looks like a USB stick. A software wallet might be nothing more than an app icon on a phone. If the deceased didn't leave records, an executor could miss substantial holdings without realising they were ever there.

The Act raises the stakes on this too. Beneficiaries who suspect digital assets have been left out of the estate account now have a clearer statutory basis for asking awkward questions. And if necessary, for challenging the administration. An executor who was careless about looking into digital holdings faces a more clearly defined liability than they did before.

What should executors actually do? Start by checking for a digital asset inventory or letter of wishes. Search the deceased's email for references to exchanges. Coinbase, Kraken, Binance. Look at bank statements for payments to crypto platforms. Check phones and computers for wallet apps. Ask family and close friends whether the deceased ever mentioned holding crypto. None of this is new guidance really, but the Act puts more weight behind it.

If you've been named as an executor and you're not great with technology, that's perfectly fine. But you need to know this responsibility exists. Think about getting help from someone who understands the landscape. The duty of care applies to a Bitcoin wallet just as much as it does to a house or a bank account.

HMRC didn't wait for this Act. They've treated crypto as taxable property for years, publishing guidance on Capital Gains Tax, Income Tax and Inheritance Tax for crypto holdings. The Act doesn't really change their position. It just bolts a statutory foundation under what they were already doing.

For Inheritance Tax, digital assets in the estate get valued at the date of death and lumped into the total. If the estate goes over the nil-rate band (£325,000 per person at the time of writing), tax hits at 40 per cent on the excess. Digital assets count towards that threshold the same as everything else.

Crypto valuations are particularly tricky, and I think this is something people underestimate. Prices can swing wildly in a matter of hours. The date-of-death valuation is what counts, and HMRC expects executors to use a reasonable method to establish market value at that point. For stuff traded on major exchanges, that's usually manageable. For more obscure tokens, NFTs, or assets on decentralised platforms, the valuation exercise gets genuinely difficult. Professional help might be worth every penny.

One thing that deserves a closer look is how digital assets interact with the residence nil-rate band. That band (up to £175,000) applies when you leave your home to direct descendants. Digital assets aren't residential property, so they don't qualify for this allowance. But they do count towards total estate value. And that matters, because estates over 2 million pounds start losing the residence nil-rate band through tapering. So a big crypto portfolio could, theoretically, push an estate over the taper threshold and shrink the overall tax-free amount. People miss this. I think a lot of people miss this.

The Act also gives HMRC a firmer hand on enforcement. With digital assets now clearly classified as property, trying to hide crypto from the estate account isn't just careless. It's a failure to disclose taxable property, full stop. Executors should know that HMRC has been investing in blockchain analysis tools and doing data-sharing deals with crypto exchanges for years now. The notion that crypto is somehow invisible to the taxman? Outdated. And, frankly, dangerous to believe.

Before the Act, there was a respectable academic argument that you couldn't place a Bitcoin into a trust. A trust needs identifiable property. If crypto wasn't formally recognised as property, the trust might fail at the starting line. In practice, most lawyers treated this as a theoretical worry rather than a genuine one. But theoretical worries have a way of keeping cautious practitioners up at night.

The Act kills that argument dead. If digital assets are property, they can be the subject of a trust. Done.

This opens up planning options that were previously hedged with caveats and crossed fingers. A discretionary trust holding a crypto portfolio for family members is now on solid statutory ground. A life interest trust that gives one person the benefit of digital assets during their lifetime, then passes them on, is legally cleaner than it was six months ago. A bare trust holding NFTs for a child until they turn 18 is valid beyond any doubt.

For estate planning, the trust angle is particularly useful where someone held big digital assets and wanted control over how and when beneficiaries received them. Handing crypto outright to an 18-year-old who's never managed money? I wouldn't. I really wouldn't. A trust with the right trustee, whether that's a professional or a family member with the skills for it, can manage the assets, handle tax reporting, and distribute things on a timetable and terms that the person who set the trust up actually chose.

I should flag though that trusts involving digital assets bring their own practical headaches. The trustee needs to be able to access and manage the holdings, which means dealing with wallets, private keys and exchanges. Trust accounting for volatile assets needs clear valuation policies. And the ongoing tax reporting that applies to trusts? It applies to digital assets sitting inside those trusts just the same as shares or property. These are solvable problems. But they need proper thought upfront, not after the fact.

The Act is in force. The legal position is clearer than it's ever been. If you hold digital assets of any kind, now is the time to make sure your estate planning catches up.

Review your Will. If it doesn't mention digital assets, or if it leans on a general "personal possessions" clause to cover them, you need to update it. Put in a specific clause dealing with crypto, NFTs and whatever other blockchain-based stuff you hold. Name the person who should receive them, or say explicitly that they fall into the residuary estate. Either way, make the intention obvious. Don't leave it to guesswork.

Create a digital asset inventory, or update the one you've got. List every crypto exchange account, every wallet (hardware and software), every NFT marketplace account, every platform where you hold tokens. For each one, note the platform name, the rough value, and whether it's a custodial account on an exchange or a self-custody wallet controlled by your own keys. Don't put private keys or seed phrases in the inventory itself. I can't stress that enough. Store those separately and securely. A fireproof safe. A bank safe deposit box. A sealed envelope with your solicitor. Somewhere that isn't "a sticky note in a desk drawer."

Tell your executors. This gets skipped more than anything else, and it's the step that matters most. Your executor needs to know digital assets exist, that there's an inventory, and where to find the access information. If your executor isn't comfortable with technology, think about naming a technically capable person in your Will or letter of wishes who can help with the digital side of things.

Consider the tax position. If your digital holdings are substantial, think about whether they push your estate closer to, or over, the inheritance tax threshold. Talk to a tax adviser or solicitor about whether any reliefs or structures might reduce the bill. The Act makes the tax treatment unmistakable, which also means HMRC has less reason to cut slack for mistakes or gaps.

Keep records of what you paid for things. Your executors will need acquisition costs for Capital Gains Tax calculations on disposals during estate administration. If you've been trading crypto for years without tracking what you paid? Start now. Because the alternative is your executor trying to reconstruct your trading history from exchange records that may or may not still exist.

Set a review schedule. Digital holdings change faster than most other types of property. I'd say twice a year at a minimum. Stick it on the same calendar reminder as your Will review, or set a separate one. Whatever works. Just don't let it drift.

The Property (Digital Assets etc) Act 2025 isn't the end of the story. It settles the foundational question of whether digital assets count as property. But there's plenty of practical detail still to be worked out through case law and secondary legislation.

Questions remain. How do decentralised autonomous organisations sit within trust law? What happens to staking rewards and yield-farming income inside an estate? How should NFTs that generate ongoing royalties be valued and split up? These are things for lawyers and courts to wrestle with over the coming years. I expect we'll see a steady drip of guidance as real-world cases work through the system.

The Law Commission's original recommendations went further than what Parliament actually passed. Their proposals included more detailed provisions on control, transfer and protection of digital assets, and some of that may yet turn up in future legislation. For now, the Act gives us the statutory anchor that was missing. That alone is a big step.

What I find encouraging, actually, is the speed. The Law Commission consultation closed in late 2023. Royal Assent came in December 2025. By the standards of English legal reform, that's rapid. It tells me Parliament takes digital assets seriously and is willing to get on with it rather than waiting for a perfect answer that never arrives.

For ordinary people doing estate planning, the message is simple enough. The law now recognises your digital assets as property. Your Will should do the same. The tools are there. Use them.

Keystone Estate Planning is an estate planning service, not a law firm. The information in this article is for general educational purposes and should not be taken as legal, financial, or tax advice. Laws and regulations change, and every person's circumstances are different.

The Property (Digital Assets etc) Act 2025 applies in England and Wales. Scotland and Northern Ireland have separate legal systems, and the position on digital assets may differ in those jurisdictions.

If your estate includes significant cryptocurrency holdings, complex trust arrangements, or cross-border digital assets, we'd recommend speaking to a solicitor who specialises in estate planning or digital asset law. For inheritance tax questions involving digital assets, a chartered tax adviser with estate planning experience can provide tailored guidance.

Our online Will-writing service includes options for recording your wishes about digital assets and directing your executors on how to handle them.