Protecting Crypto Wealth with Trust Planning

Digital assets have created unprecedented opportunities for generational wealth creation. Yet, despite the significant value many hold in digital assets, most crypto owners have not taken the necessary steps to ensure that wealth is protected and passed on according to their wishes.

If private keys are lost or inaccessible, digital assets can vanish permanently. Without clear instructions for transferring assets, crypto wealth may be exposed to probate, creditors, or legal disputes. Beyond security risks, crypto holders who fail to plan miss opportunities for tax efficiency, enhanced privacy, and asset protection—benefits that traditional trust and estate planning can provide.

Why Trust and Estate Planning Matters

Trust and estate planning is designed to manage, protect, and transfer wealth efficiently. A trust is a legal arrangement that defines how assets are held, who benefits from them, and under what circumstances. These structures allow families to transfer wealth, avoid probate, protect assets from creditors, optimize taxes, and maintain privacy.

High-net-worth families have used trusts to protect and transfer wealth for generations. Well-designed trusts reduce uncertainty, minimize disputes, and provide confidence that assets will be distributed according to the owner’s wishes. Trust structures can improve the tax efficiency of generational wealth transfers and even shield assets from legal and creditor claims. Privacy is also enhanced, allowing families to manage their financial affairs outside of public scrutiny.

The Challenge of Integrating Crypto

Digital assets introduce complexities not found in traditional trust planning. One of the fundamental principles of forming a trust is transferring control of assets to an independent trustee. For crypto holders, this can seem at odds with the ethos of self-sovereignty. At the same time, custody of private keys is critical: losing access can mean permanent loss.

Not all jurisdictions recognize digital assets within trust structures, creating legal uncertainty. And integrating crypto into a trust is complex, requiring specialized expertise to manage custody, tax compliance, and regulatory obligations. Standard trust structures are often insufficient for the secure and compliant management of digital assets.

The Solution: Qualified Custodians and Regulated Trust Companies

State-chartered trust companies provide a solution for crypto holders seeking secure digital asset management. In October 2025, the SEC clarified that state-chartered trust companies can serve as qualified custodians for digital assets, provided they meet rigorous regulatory standards.

As a qualified custodian, Two Ocean Trust employs bank-grade compliance, advanced cybersecurity systems, and strict segregation of client assets. As a fiduciary, assets are held solely for the benefit of clients and cannot be used for the trust company’s operations. This creates a level of security and independence unmatched by banks or brokerage firms.

Wyoming provides unique advantages for digital asset planning. The state has enacted more than 30 laws that provide legal certainty and regulatory clarity. Its progressive trust laws support structures like dynasty trusts, asset protection trusts, and directed trusts. Privacy is protected: trust details including grantors, beneficiaries, and assets are not publicly disclosed. The state also imposes no income, capital gains, gift or estate taxes and offers robust asset protection laws, including “covered accounts” which clarify the treatment of client assets in the event of institutional bankruptcy or insolvency.

Private Trust Companies

For families with significant digital assets, a Private Trust Company (PTC) offers a compelling alternative to individual or corporate trustees. A PTC is a family-owned entity that serves as trustee of trusts established for the benefit of family members. It combines the professionalism and continuity of a corporate trustee with the ability for the family to participate in governance and decision-making.

Through ownership and control of the PTC, families can influence how their digital assets are managed, including the appointment of directors, officers, and investment advisors, while preserving the independence of the trustee structure. This approach provides a balance between control and fiduciary oversight, offering an enduring governance framework for managing both digital and traditional assets across generations.

Wyoming PTCs can be regulated or unregulated, depending on family objectives. Either approach allows full integration with Wyoming’s trust laws and asset protection framework, making them ideal for families seeking multi-generational stewardship of crypto holdings.

Other Features for Crypto Wealth Management

Trust planning for digital assets can incorporate other features to enhance flexibility and efficiency. Income-generating strategies can be designed to offset custody and trustee fees, improving overall portfolio efficiency. Crypto holders can also access liquidity without triggering taxable events by borrowing against their holdings or using crypto as collateral for loans. This approach can support significant transactions—for example, using crypto in an escrow account as earnest money for a real estate purchase—while maintaining the long-term benefits of holding the assets.

Donor Advised Funds provide a vehicle for philanthropic giving, allowing crypto holders to make tax-deductible contributions, retain advisory privileges over grants, and incorporate digital assets into charitable planning while avoiding capital gains taxes.

Conclusion

By integrating digital assets into thoughtfully designed trust structures, Two Ocean Trust leverages the most advanced trust and crypto laws in the United States to provide investors with peace of mind, maintain control over their assets, and ensure their wealth is preserved and passed securely to future generations.

About Two Ocean Trust

Two Ocean Trust partners with ultra-high-net-worth individuals, family offices, and foundations. As a privately owned trust company, independent of other financial institutions, we deliver trust, custody, and investment solutions to a select number of important relationships. This approach ensures our interests align fully with our clients’ long-term goals.