Attorney Bitcoin Access Authority

Legal Authority for Estate and Client Bitcoin Access

This memo is published by CustodyStress, an independent Bitcoin custody stress test that produces reference documents for individuals, families, and professionals.

Sources of Attorney Authority

Attorneys involved in estate administration may need authority to access bitcoin on behalf of estates or clients. The question of attorney bitcoin access authority involves understanding what legal authority an attorney needs, how that authority is obtained, and how legal authority relates to technical access capability. These questions become relevant when attorneys handle estates containing bitcoin, represent executors or beneficiaries in bitcoin-related matters, or otherwise find themselves needing to interact with cryptocurrency as part of their professional duties.

The attorney's situation differs from the executor's situation, though both involve authority questions. An executor derives authority from court appointment to administer an estate; an attorney derives authority from representation relationships and specific engagements. These different authority foundations produce different documentation requirements and different mechanisms for establishing that authority to third parties who need to verify it. Understanding these distinctions helps clarify what authority documentation attorneys need for various bitcoin access scenarios.

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Sources of Attorney Authority

Attorneys may derive authority to access or manage bitcoin from several sources, depending on their role and the circumstances that bring them into contact with bitcoin holdings. Each authority source has different characteristics, different documentation requirements, and different scope limitations. The attorney who understands these sources can identify which applies to their situation and obtain appropriate documentation.

Client authorization provides the most direct authority source. A client who owns bitcoin can authorize their attorney to access it on their behalf, whether for litigation purposes, estate planning, business transactions, or other matters. This authorization typically comes through an engagement letter or specific written authorization that defines what the attorney can do. The scope of authority depends on what the client authorizes—some authorizations may be narrow, permitting only specific actions, while others may be broad, permitting general management. Client authorization applies during the client's lifetime and competence; it does not survive death or incapacity unless other arrangements exist.

Court appointment as executor or administrator provides authority over estate assets. When an attorney serves as executor—not merely representing the executor but actually holding the role—they derive authority from letters testamentary or letters of administration issued by the probate court. This authority enables the attorney-executor to manage estate assets, including bitcoin, according to estate administration requirements. The court appointment establishes authority that third parties can verify by examining the court-issued documents.

Representation of a fiduciary provides derivative authority. When an attorney represents an executor, trustee, or other fiduciary rather than serving in that role personally, the attorney acts on the fiduciary's behalf. The fiduciary authorizes the attorney to take specific actions within the fiduciary's authority; the attorney's authority derives from and cannot exceed the fiduciary's own authority. Documentation for this derivative authority includes both the fiduciary's own authority documents and the fiduciary's authorization to the attorney.

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Authority Documentation

Establishing attorney authority to access bitcoin requires documentation that varies by context. Third parties asked to recognize attorney authority—whether institutions, individuals, or software systems—need evidence that the claimed authority actually exists. What documentation suffices depends on what authority source applies and what the attorney is trying to accomplish.

Letters testamentary or letters of administration establish executor authority for attorneys serving in that role. These court-issued documents confirm the attorney's appointment to administer a specific estate. Institutions that respond to legal authority—such as exchanges or custodians—typically accept these documents as proof of authority to access estate accounts. The documents should be recently issued or certified as still valid, since institutions may question stale documents.

Powers of attorney establish agency authority during the principal's lifetime. A client may execute a power of attorney authorizing a specific attorney to manage financial affairs, potentially including bitcoin. The POA document, along with proof of the principal's identity and competence at execution, establishes the attorney's authority to act as agent. Institutions vary in their POA acceptance policies; some require specific language, recent execution, or additional verification. Self-custody bitcoin has no institution to present POA documents to, making technical access rather than institutional acceptance the operative constraint.

Court orders may provide authority in contested or unusual situations. When disputes arise about who has authority over bitcoin, or when standard authority mechanisms prove insufficient, courts may issue orders granting specific authority to attorneys or others. These orders provide explicit judicial authorization that even reluctant parties must respect. Obtaining court orders requires legal proceedings, making this authority source slower and more expensive than direct authorization but potentially more powerful when other approaches fail.

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Authority Versus Access

Legal authority to access bitcoin differs from technical capability to access bitcoin. An attorney with clear legal authority faces the same technical requirements as anyone else attempting to access self-custody holdings. Legal documents that unlock institutional accounts accomplish nothing for bitcoin held outside institutions. This gap between authority and access represents a fundamental challenge for attorneys working with self-custody bitcoin.

Institutional bitcoin responds to authority differently than self-custody bitcoin. When bitcoin sits on an exchange or with a custodian, the institution controls access and can grant it based on legal authority documentation. The attorney presenting proper authority documents to an exchange can typically obtain access to exchange accounts, just as they would with a bank or brokerage. Institutional custody makes legal authority operationally useful because an institution exists to recognize and respond to it.

Self-custody bitcoin recognizes only cryptographic authority. No institution exists to accept authority documents and grant access. The blockchain does not verify legal authority; it verifies cryptographic signatures. The attorney with impeccable legal authority but no seed phrase cannot access self-custody bitcoin, while someone with the seed phrase but no legal authority can move the bitcoin freely. This technical reality exists independently of legal frameworks, which is what makes self-custody uniquely challenging for attorneys accustomed to working within third-party systems.

Bridging authority and access requires technical access information alongside legal authority. The attorney who has both proper authority documentation and the technical information needed for access—seed phrases, passwords, procedures—can exercise their authority effectively. The attorney who has authority without technical access must either locate that technical information through other means or accept that their authority cannot translate to actual access. Estate planning that addresses both legal authority and technical access provisions creates conditions where attorneys can actually help; planning that addresses only legal authority may leave attorneys empowered but unable.

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Verification Challenges

Third parties asked to rely on attorney authority face verification challenges that affect whether they accept claimed authority. These verification challenges affect attorneys attempting to access bitcoin through institutions, coordinate with other parties, or otherwise exercise authority that requires third-party recognition.

External verification processes vary significantly. Different exchanges, custodians, and services have different requirements for accepting attorney authority. Some may require original documents; others accept copies. Some verify with courts; others rely on document review. Some have established estate processes; others handle requests ad hoc. The attorney cannot assume that authority documentation sufficient for one institution will work for another; each institution's policies govern what that institution requires.

Verifying attorney identity presents additional challenges. Documents establishing authority for "Attorney X" require verification that the person presenting the documents actually is Attorney X. Institutions may require identification, bar verification, or other proof that the attorney presenting authority is who they claim to be. These identity verification requirements exist alongside authority verification requirements, creating multiple layers that must all be satisfied.

Multi-party custody arrangements introduce coordination verification. If the attorney needs cooperation from other parties to access bitcoin—such as additional key holders in a multisig arrangement—those parties may want their own verification of the attorney's authority before cooperating. The attorney cannot simply assert authority; they must prove it to the satisfaction of each party whose cooperation is needed. Different parties may have different verification standards, creating multiple verification hurdles to clear.

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Scope and Limitations

Attorney authority has scope limitations that affect what actions the attorney can take with bitcoin. Understanding these limitations helps attorneys avoid exceeding their authority, which could expose them to professional discipline, malpractice claims, or other consequences. The scope of authority depends on its source and any limitations within the authorizing documents.

Client authorizations may be narrowly scoped. A client who authorizes an attorney to access bitcoin for a specific transaction does not thereby authorize the attorney to do anything they want with that bitcoin. The authorization scope—specified in engagement letters, authorization documents, or other agreements—defines permissible actions. The attorney who exceeds authorized scope acts without authority for the excess, even if their underlying relationship with the client is legitimate.

Fiduciary authority has inherent limitations. An executor, trustee, or other fiduciary has authority to act within their fiduciary role but not for personal benefit or purposes outside that role. An attorney deriving authority from a fiduciary inherits these limitations; the attorney cannot use derived authority to accomplish things the fiduciary themselves could not authorize. The scope of fiduciary authority also defines the scope of derivative attorney authority.

Jurisdictional limitations may restrict authority across borders. Authority recognized in one jurisdiction may not be recognized in another. For bitcoin held by foreign parties, involving foreign custody services, or subject to foreign legal claims, domestic attorney authority may face challenges that purely domestic matters do not present. International aspects of bitcoin custody can create authority complications that domestic planning does not anticipate.

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Professional Responsibility Considerations

Attorneys handling bitcoin access face professional responsibility considerations that shape how they exercise authority and handle custody materials. Bar rules governing competence, confidentiality, conflict of interest, and property safekeeping all apply to attorney bitcoin work. These professional obligations exist alongside legal authority considerations and may impose additional constraints or requirements.

Competence requirements affect attorneys working with unfamiliar technology. Attorneys must provide competent representation, which includes sufficient understanding of relevant subject matter. An attorney who handles bitcoin matters without adequate cryptocurrency knowledge may violate competence requirements, even if they have proper authority. Developing competence through education, associating with knowledgeable colleagues, or referring matters to more qualified attorneys addresses competence concerns.

Safekeeping obligations apply when attorneys hold client property. If attorneys receive custody materials—seed phrases, hardware wallets, access credentials—they must safeguard that property appropriately. The security requirements for bitcoin custody materials exceed those for conventional client property given the irreversible nature of cryptocurrency theft. Attorneys who accept custody materials take on security responsibilities they may not be prepared to fulfill.

Confidentiality requirements protect client information including cryptocurrency holdings. Information about client bitcoin holdings, custody arrangements, and access credentials constitutes confidential client information that attorneys must protect. Disclosure, even inadvertent, could violate confidentiality obligations and expose the attorney to discipline. The sensitivity of custody information demands particularly careful confidentiality practices.

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Conclusion

Attorney bitcoin access authority derives from client authorization, court appointment as fiduciary, or representation of fiduciaries who themselves have authority. Each source has different documentation requirements—letters testamentary for executors, powers of attorney for agents, engagement letters for direct client authorization. These legal authority documents establish the attorney's right to access bitcoin, but establishing authority is not the same as having access capability.

The gap between legal authority and technical access defines the core challenge for attorneys working with self-custody bitcoin. Institutional bitcoin responds to authority documentation through third-party processes. Self-custody bitcoin requires cryptographic capability regardless of legal authority. The attorney with perfect legal authority but no seed phrase cannot access self-custody bitcoin; technical access information must exist alongside legal authority for the attorney to actually help.

Verification challenges, scope limitations, and professional responsibility considerations all affect how attorneys exercise bitcoin access authority. Third parties may require verification before recognizing authority. Authority scope depends on its source and authorizing documents. Professional obligations around competence, safekeeping, and confidentiality apply to attorney bitcoin work. Attorneys who understand these dimensions can navigate bitcoin access authority effectively; those who do not may find their authority meaningless in practice despite being legally sound.

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System Context

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How to Explain Bitcoin Custody to Attorney

Bitcoin POA Acceptance by Third Parties

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