Stacy Singer and Fred Weber are out with a new article for fiduciaries. We previously recommended their April 20, 2021 article as a “must-read for fiduciaries and professionals in the trust and estate planning industry and anyone in the digital asset industry.” Unlike their earlier article, which resides behind a paywall, the authors received permission to reproduce this new one so that it is publicly-available (we’ve asked if they can republish their 2021 article and will provide updates here if they do).
Some highlights from the article:
- Once again, Singer/Weber point out that the legal regime governing digital assets includes much more than just cryptocurrency and NFTs. They reference several other types of valuable digital assets that should be included in estate planning.
- A short primer on a trustee’s (1) duty to take and keep control, (2) duty to preserve trust property, (3) duty to exercise reasonable care and skill, and (4) responsibility to follow the Prudent Investor Rule.
- The very real issues inherent in (1) locating digital assets, (2) accessing digital assets, and (3) taking control of digital assets (among other trustee issues).
The authors published the article shortly before the SEC released its proposed amendments to the custody rule of the Investment Advisers Act of 1940 (which we discuss here), so readers should recognize that many of the authors’ recommendations relating to access and control may change if the SEC’s amendments are adopted.
While lawmakers, regulators, and fiduciaries seem singularly focused on cryptocurrency and NFTs, Singer/Weber continue to call attention to the much broader implications of their actions on the broader spectrum of digital assets. Though the article is written pragmatically for lawyers, trustees, fiduciaries, and other practitioners in the trust and estate industry, it should also serve as a warning about unintended consequences.
Link to article along with an alternate link