Self-custody done well means nobody but you can move your coins. Inheritance means someone else must be able to, at a moment you will not be present to help.
Those two requirements point in opposite directions, and the tension between them is the entire problem. Every hardening step, a passphrase, a hidden location, a setup only you understand - is also a step that makes recovery by your family less likely.
An unknown but certainly large quantity of bitcoin is permanently unspendable for exactly this reason. Not stolen. Just unreachable, because the one person who knew how died.
What your family is actually up against
Assume the worst realistic case: someone who is grieving, not technical, and has no idea what they are looking for.
They may not know it exists. No statement arrives, no bank writes to the estate. If it is not written down somewhere they will look, it is gone by default.
They may find the words and not know what they are. Twelve or twenty-four words on a card mean nothing to someone who has never seen a seed phrase. They can be thrown out with the rest of the paperwork.
They may not know what to do with them. Which wallet software? Which derivation path? Is there a passphrase? A multisig descriptor?
They may be talked into something disastrous. A stranger offering to "help recover crypto for the family" is a well-established way for this to end.
A lawyer may not be able to help. Most estate lawyers have no procedure for a bearer asset with no registry and no issuer.
Any plan has to survive all five.
Do not put the seed in your will
The most common instinct, and it is wrong. In many jurisdictions a will becomes a public document once probate begins. Beyond that, it is read by lawyers, clerks and executors, and it may sit in a filing system for years before it is executed.
A will is the right place to record that the asset exists and where the instructions are kept. It is the wrong place for anything that can spend the coins.
Approaches that work
The letter, kept with the seed
The simplest thing that helps, and the most underrated. Alongside your backup, a written document that assumes zero knowledge:
- What this is, in plain words: "These 24 words control approximately X bitcoin."
- Roughly how much, so the finder understands it matters.
- Exactly which wallet software to use, and where to download it from.
- The derivation path, and whether a passphrase exists, and if so, where.
- A named, trusted person to call for technical help, with contact details.
- An explicit warning: never enter these words into a website, never send them to anyone, never accept unsolicited help.
Write it for someone who has never heard of Bitcoin, because that is who will read it.
Then be honest about what the letter costs. It makes the backup legible, and legibility cuts both ways: a card of twenty-four words means nothing to a burglar, and the same card with a note explaining what it controls means a great deal. From the moment the letter exists, the letter and the seed together are the wallet, and they have to be protected as one thing. If the place you keep them is not somewhere you would happily leave the same amount in cash, leave the figure out, write "a meaningful amount", and put the number in the instructions your executor receives instead. The figure will be wrong in a year anyway.
2-of-3 multisig, with keys distributed
Structurally the best fit, because it solves inheritance and security with the same mechanism.
You hold two of the three keys and spend with them as normal. The third goes to a lawyer, a family member, or a collaborative custody provider, who can do nothing with it alone. After your death, your executor combines that third key with one of yours from the estate, and moves the coins.
Two things decide whether it works, and neither is cryptographic. Your two keys have to sit in places that do not fail together, or you have rebuilt the single point of failure you were trying to remove and added two devices to it. And the third holder has to still have that key, and still be findable, in ten or twenty years: ask what happens to it when the firm is sold, the relative moves house, or the provider closes.
The essential detail: the wallet descriptor must be stored with the instructions. Three seeds without the descriptor do not reconstruct a multisig wallet. This is where these plans most often fail.
Time-locked and dead man's switch schemes
Various services will release information if you fail to check in for a set period. Some setups use Bitcoin's own timelocks so a recovery path becomes spendable only after a date.
Timelocks enforced by the protocol are trustworthy. Services that hold your secrets and promise to release them are a different matter: you are betting your estate on a company outliving you and behaving correctly at the exact moment you cannot supervise. Historically that has not gone well. Use these as a supplement, never as the only path.
Sharding the seed
Splitting the seed into pieces, either with Shamir's Secret Sharing or simply by giving words 1-8, 9-16 and 17-24 to three people, is popular and is usually a mistake for inheritance.
The naive version is worse than it looks. A twelve-word seed carries 128 bits of entropy and a four-bit checksum, eleven bits to a word, which is what BIP 39 specifies. Hand someone eight of those words and the other four are about 2^40 candidates away, roughly a trillion. That is expensive rather than impossible, and it is the kind of expensive that gets cheaper every year. With twenty-four words the remaining search is vastly larger and the arithmetic is not the problem, but you have still handed two thirds of your secret to people whose cooperation you now depend on.
Shamir's version does not leak that way, and its standard form for wallets is SLIP-39. It still multiplies the ways recovery fails: any lost share can be fatal, the holders have to cooperate at a moment of family stress, and few wallets implement it, so your heirs may need software they cannot find. Multisig reaches the same goal with a design built for it.
Test it while you are alive
This is the step that turns intent into a working plan, and almost nobody does it.
Do a dry run. Sit with the person who would have to execute this. Hand them the instructions. Have them recover a small test wallet, from the documents alone, without your help. Watch where they get stuck.
You will find gaps. Everyone does: a step you thought was obvious, software that has changed, a term nobody outside Bitcoin knows. Better to find them now.
Then repeat it. After you change hardware, change your setup, or every couple of years regardless. Instructions rot: wallet software changes, download links move, the people you named change addresses.
A workable minimum
If you do nothing else:
- Write the plain-language letter and keep it with your backup.
- Tell one trusted person that bitcoin exists and where the instructions are, not the seed itself, just that it exists and where to look.
- Reference the asset in your will, pointing to the instructions without reproducing anything that can spend it.
- Once, with someone else doing the work, test the recovery.
That is an afternoon, and it is the difference between an inheritance and an unsolvable puzzle.
Related: multisig and what self-custody requires.