Introduction
With the advent of technology, society changes and laws evolve accordingly. Computers and similar technologies have given rise to a new class of assets, called digital assets, which includes cryptocurrencies (a form of digital money), non-fungible tokens (NFTs), stablecoins and utility tokens. According to a report in India Today on the Chainalysis Global Crypto Adoption Index, India ranked first in the world in cryptocurrency adoption in 2025, retaining the top position it had held in earlier years.1 Indians are thus among the most active adopters of digital assets, and the main question is whether Indian law is adapting to this new type of asset.
This article examines how the Indian law of succession deals with these new types of assets, where its grey areas lie, and what changes could adapt it to them. It first considers what constitutes a digital asset, then discusses the Indian laws of succession applicable to digital assets, then identifies the legal gaps that the law leaves, and finally concludes with recommendations.
Defining digital assets
At the outset, it is important to define what exactly constitutes a digital asset. There is no universal definition, and different bodies and jurisdictions have defined the term in different ways. The Financial Action Task Force, for example, defines a virtual asset as “a digital representation of value that can be digitally traded or transferred and can be used for payment or investment purposes.”2 The OECD defines a crypto-asset as “a digital representation of value that relies on a cryptographically secured distributed ledger or a similar technology to validate and secure transactions.”3
Although these definitions differ from each other in one respect or another, they share certain elements, and others follow from the way such assets work. First, digital representation: these assets exist purely in the digital realm. Second, value: they carry some economic, utility or proprietary value. Third, they rely on technology for their creation, validation and security. Fourth, transferability: they can easily be transferred from one person to another. Fifth, there is a control mechanism. Lastly, they are intangible in nature. Digital assets therefore consist of digitally represented value, secured by technology, capable of transfer and controlled through access mechanisms, while remaining intangible in nature.
It is clear from this discussion that, while the terminology and scope of digital assets vary across regulatory frameworks, their underlying features remain consistent. These assets are defined not merely by their digital form but by the convergence of value, technology, transferability and control. This composite understanding is crucial, as it allows digital assets to be placed within existing legal doctrine, particularly the law of property and succession. At the same time, their unique reliance on technology introduces complexities that legal frameworks were not designed to address.
Indian laws of succession relating to digital assets
Although India has no comprehensive statute regulating cryptocurrencies, the Madras High Court held in Rhutikumari v. Zanmai Labs Pvt. Ltd. that cryptocurrency is “property” under Indian law: it is “not a tangible property nor is it a currency”, but it is “capable of being enjoyed and possessed (in a beneficial form)” and “capable of being held in trust”.4 The court reasoned that “property” in Indian law is a term of the widest import, covering every interest that a person can hold or enjoy, and that cryptocurrency is capable of being stored, traded and sold. It follows that laws relating to property, such as those governing succession, can apply to it.
In India, succession is governed either by the Indian Succession Act, 1925 or by the personal law of the person who holds the property in question. Under the Indian Succession Act, every person of sound mind who is not a minor may dispose of his property by will.5 In preparing a will that covers digital assets, the following points should be kept in mind. First, the passwords and PINs protecting such assets should not be written directly into the will, because a will propounded for probate becomes part of the court record, which puts the assets at risk. Second, all digital assets should be clearly identified. Some digital assets have more than one income-generating component: a YouTube channel, for example, can earn money through advertising revenue and sponsorships, so the will should specify who receives the advertising revenue and to whom the sponsorships pass. Third, accessing digital assets can be difficult, so the will should contain all the information needed to access each asset. Fourth, the executor appointed to execute the will should have a basic knowledge of how the technology works. Lastly, not all digital assets can be transferred. Digital copies of rare video games, for example, merely give the user a licence to use the game, not full ownership, and their transfer therefore depends on the policy of the game or software publisher. As for personal law, because these assets are property, the personal laws of succession apply to them in the same way as the secular law described above; but applying these age-old laws to something as modern as digital assets raises problems of its own.
The first major issue in applying these laws is that, unlike title deeds and other physical assets, digital assets often require passwords, PINs and similar credentials before they can be reached. A person may therefore inherit a digital asset and yet be unable to use it for want of the credentials needed to access it.
The second issue is the absence of a legal classification for such property. The law treats movable and immovable property differently, and no statute says expressly into which category digital assets fall. The General Clauses Act, 1897 defines movable property residually, as “property of every description, except immovable property”,6 so digital assets would ordinarily be movable; without express recognition, however, their treatment remains uncertain and doctrinally unclear.
The third issue is conflict with contractual terms. Digital assets are often governed by the agreement of the platform on which they are stored. If, for example, a person’s bitcoins are held in an exchange wallet whose terms prohibit transfer, the heirs may be deprived of the property despite having rights to it.
Lastly, there are privacy concerns. Digital assets often contain photographs, videos and other material relating to other people, and giving third parties (in this case the legal heirs) access to them can raise serious concerns under privacy law and the policies of the platform.7
Comparative framework
Several countries have adopted different models to address these issues. In the United States, the Uniform Law Commission approved the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) in 2015 as a model law for enactment by the states. It modernises estate and trust law for the digital era by giving fiduciaries legal authority to manage digital assets and electronic communications in the same way as tangible assets and financial accounts, to the extent possible, while respecting the user’s intent and privacy. A direction given by the user, through an online tool offered by the platform or in a will, generally prevails over the platform’s terms of service. The Act distinguishes between the content of electronic communications, which a custodian must disclose only if the user consented or a court so directs, and a catalogue of the user’s communications and other digital assets, such as files, which is disclosed unless the user prohibited it or a court directs otherwise.8
Germany has taken a notably progressive stance. In the Facebook inheritance case, the Federal Court of Justice (Bundesgerichtshof) held that the user agreement for a deceased person’s social-network account passes to the heirs as part of the estate, so that the heirs may access the account and the content held in it.9 Drawing an analogy with traditional forms of communication such as letters and diaries, which pass to the heirs, the court found no justification for treating digital content differently. The principle that emerges is that digital assets are inherited like any other property, without special distinction, which places them squarely within the ambit of succession law.
Scope for improvement in Indian law
In the light of these drawbacks and the comparative analysis, Indian law lags behind in legislating on these questions, and if the gaps are not addressed soon, they may create serious difficulties for the courts in future.
First, a comprehensive digital assets law should be enacted to govern all succession-related matters concerning digital assets: because these assets are special in nature, they require a special secular law.
Second, the legislature should expressly recognise digital assets as intangible movable property. This would resolve much of the conflicting opinion and confusion about the laws applicable to such property.
Third, the State should create a procedure to give the heirs of a deceased holder access to the property where the holder dies without leaving a record of the passwords. The question remains open elsewhere too: the Law Commission of England and Wales expressly left succession outside its 2023 report on digital assets, noting a suggestion that rights of access to accounts on death be examined in a separate project.10 Fourth, the holder should be required to nominate a legal heir at the time the asset is acquired.
Fifth, Indian law must resolve the conflict between contractual terms and the statutory rights created by the law of succession. Sixth, the Information Technology Act, 2000 should be amended to bridge the gaps between data law and succession law.11
Conclusion
The emergence of digital assets marks a significant transformation in the concept of property, challenging traditional legal frameworks that were designed for a pre-digital era. As this article has shown, while Indian succession laws, both statutory and personal, are broad enough in principle to include digital assets within the ambit of inheritable property, they remain inadequate in addressing the unique characteristics of such assets.
The core difficulty lies in the disconnect between legal entitlement and technological control. Unlike conventional property, digital assets are governed not only by law but also by access mechanisms such as passwords and private keys, and by contractual terms imposed by digital platforms. This creates situations in which legal heirs may hold valid rights but be unable to exercise them in practice. The absence of clear classification, the lack of statutory recognition and the unresolved conflicts between contractual and succession rights further complicate the legal landscape.
The comparative analysis reveals that the United States and Germany have taken significant steps to bridge these gaps, through model legislation in the one case and progressive judicial interpretation in the other. These models demonstrate that effective regulation must go beyond the mere recognition of digital assets as property and must ensure that inheritance rights are enforceable in practice.
It is therefore imperative for Indian law to evolve in step with technological change. A dedicated legal framework, express recognition of digital assets as property, and mechanisms to secure access for legal heirs are no longer optional but necessary. Without such reforms, the law risks becoming increasingly disconnected from reality, granting rights in theory while failing to secure them in practice.
Ultimately, the future of succession law in India will depend on its ability to reconcile traditional legal principles with the dynamic and technologically driven nature of digital assets.
*****
Footnotes
1. India Today Business Desk, India Tops Global Crypto Adoption Rankings Again in 2025: Report, India Today (Sept. 8, 2025, 2:35 PM IST), https://www.indiatoday.in/business/story/india-tops-global-crypto-adoption-rankings-again-in-2025-report-2783757-2025-09-08.
2. Fin. Action Task Force, Updated Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers 21, ¶ 44(b) (Oct. 2021), https://www.fatf-gafi.org/en/publications/Fatfrecommendations/Guidance-rba-virtual-assets-2021.html.
3. Org. for Econ. Co-operation & Dev., Crypto-Asset Reporting Framework and Amendments to the Common Reporting Standard 19 (2022).
4. Rhutikumari v. Zanmai Labs Pvt. Ltd., O.A. No. 194 of 2025, 2025:MHC:2437, ¶¶ 44–48 (Madras H.C. Oct. 25, 2025) (India).
5. The Indian Succession Act, No. 39 of 1925, India Code (1925), § 59.
6. The General Clauses Act, No. 10 of 1897, India Code (1897), § 3(26), (36).
7. Prashant Mali & Aswathy Prakash G, Death in the Era of Perpetual Digital Afterlife: Digital Assets, Posthumous Legacy, Ownership and Its Legal Implications, 15 Nat’l L. Sch. J. 124 (2019–20), https://repository.nls.ac.in/nlsj/vol15/iss1/8.
8. Revised Unif. Fiduciary Access to Digital Assets Act prefatory note, §§ 4, 7–8 (Unif. L. Comm’n 2015).
9. Bundesgerichtshof [BGH] [Federal Court of Justice] July 12, 2018, III ZR 183/17 (Ger.).
10. Law Commission of England and Wales, Digital Assets: Final Report, Law Com No. 412, HC 1486, ¶ 1.6 n.2 (2023) (UK).
11. Mali & Prakash G, supra note 7.