Email accounts, cryptocurrencies, cloud storage, streaming subscriptions -- the digital estate is frequently overlooked in estate planning. We explain the legal position following the BGH Facebook ruling and provide a practical checklist.
Digital Estate: The Forgotten Assets in the Cloud
Imagine this: a family member passes away -- and nobody knows the login credentials for their email account, online banking or crypto wallet holding Bitcoin worth tens of thousands of euros. The family does not even know which services the deceased held accounts with. What sounds like an isolated case has long become the norm. Studies show that the average German maintains over 80 online accounts -- from streaming subscriptions to PayPal. What happens to this digital wealth upon death? And how can you take precautions?
What Constitutes the Digital Estate?
The digital estate encompasses the entirety of all legal relationships a person has established in the digital space. This includes:
- Communication accounts: Email inboxes, messaging services, social media profiles
- Financial assets: Online banking access, PayPal accounts, cryptocurrencies, NFTs
- Contracts and subscriptions: Streaming services, cloud storage, software licences, domain registrations
- Data and content: Photos in the cloud, documents in Google Drive or Dropbox, e-books, music libraries
- Business accounts: Online shop accounts, advertising accounts, website access
- Balances and points: Bonus miles, loyalty points, marketplace balances
The Legal Position: Section 1922 BGB and the BGH Facebook Ruling
Universal Succession Also Applies Digitally
Under Section 1922(1) BGB, upon a person's death their assets pass as a whole to the heirs -- so-called universal succession. According to the highest court's case law, this also encompasses all digital legal relationships.
The Landmark Ruling: BGH III ZR 183/17
On 12 July 2018, the Federal Court of Justice (BGH) set the course for digital inheritance law in its landmark ruling III ZR 183/17. The case: the parents of a 15-year-old girl who had died at a Berlin underground station demanded access to their daughter's Facebook account.
The BGH ruled unequivocally:
- The user contract between the deceased and Facebook passes to the heirs with all rights and obligations
- There is a fundamental equivalence of digital content (emails, chat messages) with analogue content (diaries, letters)
- The deceased's post-mortem personality rights do not preclude this
- The GDPR does not prevent the heirs' access either
This decision has signal effect for the entire digital estate: heirs fundamentally step into all contractual positions of the deceased.
Practice Often Looks Different
Despite the clear legal position, heirs encounter considerable obstacles in practice:
- Platform terms of service: Some providers include special provisions for death in their terms (e.g. memorial accounts on Facebook). Although the BGH has clarified that such clauses cannot override the heir's position, practical access often remains cumbersome.
- Two-factor authentication (2FA): Without access to the deceased's smartphone or the second factor, login fails.
- Lack of overview: Heirs frequently do not know which services hold accounts.
- International providers: Platforms based outside the EU are subject to different legal systems.
Cryptocurrencies: The Invisible Assets
The Special Challenge of Private Keys
Cryptocurrencies like Bitcoin or Ethereum present unique challenges for the digital estate. As experts in digital succession explain, the private key is the sole means of accessing crypto assets. There is no central authority where heirs can request access.
- Self-custody wallets (hardware wallets, paper wallets): Without the private key or seed phrase, the assets are irretrievably lost
- Exchange accounts (Coinbase, Kraken, Binance): Here, at least, it is possible to request access by presenting proof of inheritance
- DeFi positions: Staking, liquidity pools or smart contract interactions require specialist technical knowledge
Economic Scale
Estimates suggest that 3 to 4 million Bitcoin worldwide are permanently lost -- a significant proportion due to missing estate planning. At a Bitcoin price in the five-figure range, the loss of a single wallet can amount to a six-figure sum.
Solutions for Crypto Assets
As specialist law firms for digital assets recommend, crypto holders should take the following measures:
- Documentation: List all wallets, exchanges and DeFi positions in writing
- Secure storage of the seed phrase: Ideally deposit with a notary or store in a bank safe deposit box
- Technical instructions: Create comprehensible instructions for heirs on how to access the assets
- Multi-signature solutions: Set up wallets requiring multiple keys (e.g. heir plus lawyer)
The Role of the Lasting Power of Attorney
Why a Will Alone Is Not Enough
A handwritten will under Section 2247 BGB can contain provisions for the digital estate -- but it only takes effect after death. In practice, however, situations frequently arise where a representative must act during the person's lifetime:
- In cases of incapacity due to illness or accident
- During extended absence (e.g. time abroad without connectivity)
- For managing ongoing contracts (domains, hosting, subscriptions)
The Digital Lasting Power of Attorney
A lasting power of attorney extending beyond death is the key instrument for the digital estate during one's lifetime. It should:
- Expressly cover the digital estate
- Grant the attorney the right to access all digital accounts and services
- Include the right to terminate, amend and delete accounts
- Regulate the handling of personal data
- Ideally be notarially certified, as some providers do not accept a simple power of attorney
Practical Checklist for the Digital Estate
Step 1: Conduct an Inventory
Create a complete list of all digital accounts, contracts and assets. The consumer advice centre recommends the following categories:
- Email accounts (often the key to all other services)
- Social media profiles (Facebook, Instagram, LinkedIn, X)
- Financial accounts (online banking, PayPal, crypto exchanges, securities accounts)
- Cloud storage (Google Drive, Dropbox, iCloud, OneDrive)
- Subscriptions (Netflix, Spotify, Apple, Amazon Prime)
- Professional accounts (Xing, LinkedIn, specialist portals)
- Domains and websites (registrar, hosting provider)
- Cryptocurrencies (wallets, seed phrases, exchange accounts)
Step 2: Secure Access Credentials
- Use a password manager (e.g. 1Password, Bitwarden) and share the master password with a trusted person
- Alternatively: Store an encrypted USB stick in a secure location (e.g. bank safe deposit box)
- Update regularly -- at least once a year
Step 3: Designate a Trusted Person
- Appoint a digital estate administrator who is technically competent
- Grant this person a lasting power of attorney extending beyond death
- Inform them about the storage location of the access credentials
Step 4: Document Instructions
For each service, specify:
- Delete (e.g. dating profiles, unimportant forum accounts)
- Preserve/Transfer (e.g. photos, important emails, domains)
- Cancel (e.g. subscriptions, paid services)
- Memorial status (e.g. Facebook memorial profile)
Step 5: Legal Safeguards
- Will: Include a provision for the digital estate (handwritten under Section 2247 BGB or notarially under Section 2232 BGB)
- Lasting power of attorney: Expressly include the digital estate
- Notarial deposit: Deposit sensitive access credentials (especially crypto seed phrases) with a notary
Platform-Specific Features
Apple
Since iOS 15.2, Apple offers the Legacy Contact feature, allowing users to designate a trusted person who can access the Apple account upon death.
The Inactive Account Manager allows users to specify what happens to their Google account if it is not used for a defined period.
Facebook/Meta
Facebook offers the option to designate a Legacy Contact who can convert the profile into a memorialised profile. Alternatively, the deletion of the account after death can be specified.
The Tax Dimension
Digital assets are subject to the same inheritance tax rules as analogue assets. For cryptocurrencies in particular, special tax considerations arise:
- The value on the date of death is decisive for inheritance tax
- Unrealised gains can significantly affect the taxable value
- The documentation obligation vis-a-vis the tax office requires seamless records
- The valuation of DeFi positions and NFTs remains largely unsettled
Conclusion
The digital estate is no longer a niche topic -- it affects virtually everyone. While the BGH ruling has confirmed the fundamental inheritability of digital accounts, without practical precautions even the best legal position is of little use. Anyone who organises their passwords today, designates a trusted person and grants the necessary powers of attorney will not only spare their heirs considerable effort but may also preserve significant assets from being lost.
At compleneo, we support you with comprehensive estate planning -- including your digital assets. From drafting a lasting power of attorney through testamentary provisions to the notarial deposit of sensitive access credentials, we guide you holistically. Get in touch with us.
