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Since Bitcoin is generational wealth, there will likely come a day when your heirs need to recover your wallet.

Obviously, the best case would be to tell your heirs about your stack before you die. Death, however, occasionally comes at inconvenient moments. If you disappear today, what sort of instructions are needed to help your bitcoin end up in the right hands? While there are a lot of ways to go about passing your bitcoin on to your heirs, one crucial step is that they need to learn that it exists and how to recover it.

A Bitcoin inheritance letter

In most cases, this means some form of written instruction. Maybe it's a letter you give to your lawyer, your executor, or a trusted family member. Perhaps it's just something you write and put in the place where you keep your other important papers.

Wherever you store it, this document is your opportunity to advise your heirs that you have bitcoin and how they can safely recover it. So what do you say?

Make our letter better

We've put a lot of thought into an inheritance letter, but it's certainly not perfect (I think it's got way too many words). Let us know your opinions or suggestions about it and we'll enter you in the Satoshi's 50th Birthday drawing we're hosting on April 5 to win a free Liana Box.

Text of the letter here, image below:

BITCOIN INHERITANCE LETTER

This letter contains the instruction for recovering a Bitcoin wallet set up for you to unlock in the event of its owner's passing or inability to access it. The recover process is straightforward, you can complete it by yourself. If you need assistance, the Wizardsardine team is available to help: hello @wizardsardine.com Please note that you cannot access the bitcoins before a specified inactivity period (timelock) has elapsed. This period may be up to 15 months after the wallet was last used.

Along with this letter, you will find:

a signing device (hardware wallet) that is already set up. PIN: _____________

a USB drive containing a copy of the wallet descriptor of the Liana wallet.

a Cryptosteel Capsule containing a backup of the key in case of hardware wallet failure or destruction.

Never share the content of the Cryptosteel Capsule with anyone Scan the QR code or visit wizardsardine.com/liana/support for the latest recovery instructions adn tools, or follow the steps below:

Locate the wallet descriptor: This is a text file stored on the USB drive. It may also have been shared with you via email or another digital medium, as USB drives can become unreliable over time. The Wizardsardine team may also hold a backup for this file.

Start Liana: Download the latest version from wizardsardine.com/liana or github.com/wizardsardine/liana/releases

**Select "Add an existing wallet". Copy and paste the wallet descriptor content, then choose a node option (Liana Connect is the simplest and fastest)

Once inside the wallet, go to Settings under Recovery to initiate a transaction. Ensure you use a destination address belonging to your own, personal wallet. Plug in the signing device and verify the transaction details on its screen.

Confirm that no coins remain in the wallet that are still timelocked. If any are, you will need to wait for them to "expire" before recovering them.

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8 replies \ @justin_shocknet 27 Mar

I think there's big opportunity in cookbooks such as this, have been marinading on this problem myself with the added twist of dealing with dead-man switches for Lightning node operators.

At a glance, my critiques would be:

I don't like the suggestion of using a hardware wallet and writing down the PIN and the SPOF with a Cryptosteel/Seed Phrase.

I'm also not clear on what value multi-sig is adding here, the added descriptor just makes the process more failure prone.

The language in the letter isn't for someone naive to this whole concept, both in terms of vernacular and proper nouns. A successful cookbook will be have to be iterated to use non-Bitcoiner language and concepts.

IMO a proper cookbook should also prescribe ways that incorporate unique knowledge by the inheritant so that the backups are secure even if found by someone undesirable first. The old multifactor concept of something you have and something you know.

Standardiztion is another goal, at some point your website/product becomes another SPOF, there should be enough breadcrumbs that a non-technical person with some special knowledge can get help from someone trusted and only semi-technical... but of course this comes with time and iteration...

17 sats \ 7 replies \ @Wizardsardine OP 27 Mar

The language in the letter isn't for someone naive to this whole concept, both in terms of vernacular and proper nouns. A successful cookbook will be have to be iterated to use non-Bitcoiner language and concepts.

This is a great critique. Our letter is like a wall of text that smacks you in the face with stuff you've never heard of before. Not very approachable.

I'm also not clear on what value multi-sig is adding here, the added descriptor just makes the process more failure prone.

The letter is specific to Liana Wallet -- we use miniscript to set up a multisig that locks coins with a primary key but also a recovery key that can't spend the coins until the primary key hasn't been used in 15 months (using a relative timelock). It's more complicated, but it allows a user to store the letter/signing device/seed backup with an executor or family member without having to trust them not to steal.

In this setup, the recovery key would have already been loaded onto the signing device and the heir simply has to pull up a wallet to sign. They need the descriptor to get the wallet to find the keys.

Standardiztion is another goal, at some point your website/product becomes another SPOF

I totally agree with this. It's a great point. I feel like we should remove all links to websites. The letter ought to contain all the information a person needs to get the job done.

10 sats \ 6 replies \ @justin_shocknet 27 Mar

The timelocked key is interesting, do you have a letter for the inheritant receiving just that key? I think a good start to a doc package would focus on that, something an inheritant receives while the primary user is still alive: "Hey if I'm dead here's how to use that thing.."

Then maybe there's some coded instructions as a second page that could direct them to the primary key.

Thinking about it that way we're at 3 pages minimum.

Question:

For the primary, can it trivially bump the 15 month timelock at any time? I assume this just means they publish an updated tx... but does it effect the descriptor the inheritant may have stored?

17 sats \ 5 replies \ @Wizardsardine OP 27 Mar

The way we set it up, the user never needs to get the primary key. It's a 1 of 2 where one key is the primary and the second key is the recovery. But the script on the coins doesn't allow the recovery to spend until the primary hasn't been used in 15 months.

The primary can "refresh" the timelocks by sending to self. They have to do this for all their utxos before the relative timelock expires or the recovery key becomes active. It doesn't necessitate a change in the descriptor.

The goal of this whole construction is to avoid "coded instructions" so that inheritants can simply have a key that doesn't work until the primary user is incapacitated or dead--and to do this without needing to trust a third party, using consensus rules instead.

10 sats \ 4 replies \ @justin_shocknet 27 Mar

Gotchya, yea I just meant as an option to workaround the 15 months wait or if for example the USB key shits the bed.

I think the important doc to nail then would be to focus specifically on that secondary, then can layer in anything that needs to be coded.

EDIT: Now its coming together, this is focused on that secondary key... something about it initially made me think it was for both keys in the multisig. Guess that circles back to the first impression for someone naive to the setup...

17 sats \ 3 replies \ @Wizardsardine OP 27 Mar

yeah, I'm not even sure the USB is worth it at this point. I guess it's handy for ease of us, but I feel like I've had to chuck so many of them that it may be more trouble than it's worth.

Thanks for your feedback!

view all 3 replies

115 sats \ 20 replies \ @DarthCoin 27 Mar

No. They get nothing. Why would I give them something that they did NO PoW ? Bitcoin MUST be earn only through PoW not by bullshit inherit. Inherit is stealing.

122 sats \ 3 replies \ @TheBTCManual 27 Mar

This! If you're a productive member of society you won't need my stack, we don't raise leaches in this family

0 sats \ 2 replies \ @Wizardsardine OP 27 Mar

So what are you going to do with your stack?

The question is: what happens if you kick it unexpectedly? Do you have a plan for a spouse to recover it? Or are you going Satoshi-style donation to all bitcoiners in general by letting the coins get lost?

150 sats \ 1 reply \ @TheBTCManual 27 Mar

While I'm alive I enjoy the fruits of my labour and prudence, when i'm dead, im dead I can't care lol! I have more faith that bitcoin holders who earned their sats will do a lot of good for the world than my family getting my sats and blowing it on discretionary spending because they couldn't keep their shit together and weren't humble enough to listen to my advice in the begining

What lesson does that teach them? Oh ignore my advice, take no action or risk and live off others like a commie? Nah! This is a hill I will die on

0 sats \ 0 replies \ @Wizardsardine OP 27 Mar

I can respect that.

10 sats \ 11 replies \ @Wizardsardine OP 27 Mar

Optionally: never even tell them you are their father...

20 sats \ 7 replies \ @DarthCoin 27 Mar

seriouslly now, if during my life they weren't able to take the sats from me (with PoW), why I should let them instructions how to get my sats? It means they weren't merit those sats in the first place, Prove me you deserve my sats first. FUCK'EM'ALL No PoW = no sats

Aslo... if they know that you let them instructions how to retrieve those sats, they will do absolutely everything possible that you will die faster so they can grab those sats doing nothing.

10 sats \ 2 replies \ @plunda 27 Mar

if your kids want you to die so they can get your coins you raised them wrong

0 sats \ 1 reply \ @Wizardsardine OP 27 Mar

it's not ideal. But unless you plan on a treasure hunt, you should think about how you're going to tell them about it. Any tips?

0 sats \ 0 replies \ @plunda 27 Mar

keep it simple would be my only tip. along with discussing it with the executor of your will

reply on another page

0 sats \ 3 replies \ @Wizardsardine OP 27 Mar

This is fair. Doesn't mean you want to burn your sats. I'm less interested in who, more interested in how.

500 sats \ 2 replies \ @DarthCoin 27 Mar

How? Here an example:

They must follow my steps I did. On each 12 peaks in this picture, there's a recipient with a seed word. They must do a real PoW, hiking all those high mountains (as I did when I hide those seed words) and find the words. Then to put them in the right order.

Otherwise... they get nothing.

21 sats \ 1 reply \ @Wizardsardine OP 27 Mar

This is excellent!

But how are they going to know that they need to go look for it on mountains?

Do you plan on having a document that leaves any instructions? Or is do they need to figure it out 100% by themselves?

view all 1 replies

10 sats \ 2 replies \ @DarthCoin 27 Mar

being a father it doesn't mean you also have to give them all your hard earned sats.

0 sats \ 1 reply \ @Wizardsardine OP 27 Mar

So, what will you do with your stack? More importantly, how will you convey the instructions to whomever is tasked with recovering it?

10 sats \ 0 replies \ @criptopanas 27 Mar

Darth's sats are going to heaven with him.

120 sats \ 2 replies \ @denlillaapan 27 Mar

Darth, the Bitcoin Boomer

8 sats \ 1 reply \ @Wizardsardine OP 27 Mar

Did you hide your recovery instructions in one of the books you edited?

10 sats \ 0 replies \ @denlillaapan 27 Mar

obvs. Hiding in plain sight

0 sats \ 0 replies \ @plunda 27 Mar

so retarded

1020 sats \ 1 reply \ @020c1 27 Mar

Great inheritance letter! For sure something that is not discussed enough

What I would add/change:

Fill in the blank: Leave more room for the author to personalize their letter. For example, specify what medium was used to store the wallet descriptor (+ it cuts down on words).
Visual: Add empty squares next to each listed devices. The author can attach pictures to show which device serves what purpose.
Credentials: Add a section for Wizardsardine credentials. What info will be requested by WS to share the author's wallet descriptor?

All three points should add some clarity for their grieving heir, especially if they are not familiar with the recovery process

100 sats \ 0 replies \ @Wizardsardine OP 27 Mar

very helpful! thanks!

100 sats \ 3 replies \ @LibertasBR 28 Mar

It seems like the letter is quite concise. I’m more curious about the recovery steps so I can help with drafting the letter.

So, when an event triggers the delivery of the letter, it reaches the recipient with detailed instructions and almost all the Bitcoin available inside the hardware wallet, which will manage the release of these funds. No seed involved in the process, right? Even so, the wallet is practically set up with everything needed so that whoever gets it, along with the instructions, can access it. That seems insecure to me.

Perhaps a safer method—and one that could also reduce the size of the letter—would be allowing the wallet owner to set an heir email, which would send the wallet descriptor protected by a password.

As for the Cryptosteel, does it contain everything necessary to recover the wallet without relying on anything else? I’m not very familiar with this device and its recovery methods.

0 sats \ 2 replies \ @Wizardsardine OP 28 Mar

Thanks for the feedback!

it reaches the recipient with detailed instructions and almost all the Bitcoin available inside the hardware wallet

This is the big question. We use a relative timelock to lock the coins so that this recovery key cannot spend them until a pre-specified length of time after the primary key has been used (as much as 15 months).

If a person becomes dies, it may indeed take some time for people to sort through belongings and wills. If it takes more than 15 months, the hardware device will definitely have an active key that can spend all the funds.

Also, if the person hasn't used their primary key recently (say in the last year), then it is also pretty likely that the key on the hardware wallet will have the ability to spend the funds.

You're point is definitely worth thinking about.

Perhaps a safer method—and one that could also reduce the size of the letter

Also great point. Keeping the descriptor separate from the seed is safer, but it also adds complexity. Additionally, email addresses change or stop being checked. You could see a world where a user sets this up and then 10 years go by and the beneficiary email they designated is no longer in use. I think we've opted for a situation where everything needed to recover the funds is needed.

As for the Cryptosteel, does it contain everything necessary to recover the wallet?

The cryptosteel only has the seed. You still need the descriptor to recover the wallet. Currently this is stored on the USB drive or as an opt-in alternative on a Wizardsardine server.

100 sats \ 1 reply \ @LibertasBR 29 Mar

About the letter delivery system, who is responsible for that? If it’s a company, instead of requiring an heir email, it could use a login system, like a digital vault, where the wallet descriptor is stored. The letter would contain the login instructions, and the person in possession of it would have to prove they are a valid heir from a list left by the owner. This approach solves the issue of email technological obsolescence and centralizes the process.

Regarding the cryptosteel, if it contains the seed, all of this is just extra layers—whoever has the seed can access the wallet and transfer the funds wherever they want, without cooldowns or additional verifications.

It’s almost like a bank, which is why I don’t really like the idea, but I’m here to brainstorm, not to judge lol.

Meanwhile, I’m thinking of a more secure and personal model. Since we’re talking about inheritance, it assumes you have direct contact with the person. I also believe they should at least understand what it is because otherwise, the chances of them messing up or simply cashing out into fiat are high. In other words, they need to deserve it.

19 sats \ 0 replies \ @Wizardsardine OP 29 Mar

if it contains the seed, all of this is just extra layers

Not in this case. The seed given to the heir is actually one seed in a 1-of-2 multisig (this is why they need the descriptor--whatever wallet software they use to recover needs to be able to know how to find the coins), but it's a 1-of-2 where the primary key (held by you) can always spend and the heir's key (stored with this letter) can only spend coins if the primary key isn't used for a prespecified length of time. This is enforced by Bitcoin script at the consensus level, so not trusting a third party.

The advantage to this is exactly what you are getting at: an executor or your heir won't be able to spend your funds until you want them to (or stop using your key) even if have access to the seed/hardware signer/letter.

they should at least understand what it is

You are spot on. This is a really important point. At least with current pop understanding of Bitcoin, an heir who has no real idea about it may be very casual in their approach to recover (or just ignore it).

10 sats \ 0 replies \ @JesseJames 27 Mar

I don't. :-)

Have you written down step-by-step instructions for your heirs to recover your bitcoin?

A Bitcoin inheritance letter

Make our letter better