Can My Bitcoin Custody Survive Attorney Questions

Custody Arrangements Under Professional Scrutiny

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

The Nature of Attorney Scrutiny

Custody arrangements that feel adequate in daily life may appear quite different under professional scrutiny. Attorneys ask pointed questions: Where is the documentation? Who has authority? How is that authority evidenced? What happens if this fails? Can my bitcoin custody survive attorney questions is a way of asking whether the arrangement would hold up when examined by someone trained to find gaps, inconsistencies, and unsupported claims. The casual confidence that comes from routine use does not predict how the arrangement performs when subjected to skeptical interrogation.

This document addresses what attorney scrutiny reveals and why arrangements that seemed solid often prove fragile under questioning. Attorneys approach custody arrangements with professional skepticism, looking for what could go wrong, what is not documented, and what claims lack supporting evidence. This perspective differs fundamentally from how holders typically view their own arrangements, creating encounters where the holder's sense of adequacy collides with the attorney's identification of problems.

---

The Nature of Attorney Scrutiny

Legal professionals ask questions with a specific purpose: to identify vulnerabilities before those vulnerabilities create problems in adversarial or official contexts. They want to know what would happen if someone challenged a claim, if a court required proof, if a dispute arose between parties. This forward-looking adversarial mindset finds gaps that friendly or neutral examination might overlook. The attorney is not asking whether things work well enough for now—they are asking whether things would work when challenged by someone determined to find problems.

Questions from attorneys tend to press on specifics rather than accepting general assurances. "I have a backup" prompts follow-up: Where exactly? Who else knows? What form does it take? Is it current? How do you know it's current? Each answer generates new questions that probe deeper into the arrangement's actual structure. Vague answers or uncertainty at any point raises concerns about the overall reliability of what is being described.

Professional training shapes how attorneys interpret responses. Hesitation suggests uncertainty about facts. Inconsistency between statements suggests unreliability. Gaps in documentation suggest vulnerability to challenge. The attorney is not hostile but is calibrated to detect weakness because detecting weakness is their job. They have seen many situations where people believed their arrangements were adequate only to discover otherwise, and that experience creates appropriate skepticism about claims of adequacy.

---

Documentation and Its Absence

Attorneys immediately ask about documentation because documentation is what survives challenge. Verbal understandings, remembered agreements, and assumed arrangements evaporate under adversarial pressure. What exists on paper, properly executed and preserved, has weight. What exists only in someone's head has very little weight. The first question about any arrangement is often: what documents evidence this?

Bitcoin custody arrangements frequently lack the documentation that attorneys expect. A holder may have a hardware wallet with substantial bitcoin but no document explaining who owns it, who can access it, or what happens to it upon death or incapacity. The seed phrase backup may exist without any letter or memo explaining what it is and who is authorized to use it. These gaps seem insignificant during the holder's lifetime but become critical when anyone needs to establish rights or authority after the holder is gone.

Even when documentation exists, attorneys probe its quality. Is it signed? Is it dated? Is it stored securely but accessibly? Does it reference current conditions or outdated ones? A document created five years ago that has never been updated may be worse than no document at all if it describes an arrangement that no longer exists. The attorney's questions reveal not just whether documentation exists but whether it would actually help in the scenarios where documentation matters.

---

Authority and Its Evidence

Who has authority over the bitcoin? This fundamental question has both a legal dimension and a technical dimension, and attorneys quickly discover whether the holder has thought through both. Legal authority comes from documents: trusts, wills, powers of attorney, corporate resolutions. Technical authority comes from access: whoever possesses the keys can move the bitcoin. When these two forms of authority are not aligned and documented, attorneys see problems.

Proving authority to a skeptical party requires more than assertion. Saying "my wife has authority to access this if something happens to me" raises immediate questions: What document establishes that authority? Does your wife know about it? Does she have the technical access to exercise it? If you die tomorrow, could she actually do anything with this authority, and could she prove to others that she has the right to do it? Each question presses on assumptions that the holder may never have examined.

Legal authority without technical access creates one category of problem; technical access without legal authority creates another. Someone who holds keys but has no documented right to use them faces potential claims of theft or conversion if they move the bitcoin. Someone who has documented authority but no keys faces practical inability to exercise that authority. Attorneys identify these mismatches because mismatches create the disputes and complications that become legal problems.

---

Failure Scenarios and Contingencies

Professional scrutiny extends beyond current functioning to potential failures. What happens if the hardware wallet breaks? What happens if the passphrase is forgotten? What happens if a co-signer dies? What happens if you become incapacitated suddenly? Each question probes whether the arrangement has thought beyond the happy path where everything works as intended. Arrangements that work perfectly under ideal conditions may collapse under realistic stress scenarios.

Holders often have not thought through these scenarios systematically. When asked what happens if a specific component fails, they may offer vague reassurances rather than concrete contingencies. "I have backups" does not answer what happens if all backups prove inaccessible. "My family knows" does not answer what happens if the family member who knows dies before the holder does. The attorney's questions reveal whether the holder has actually planned for failure or merely assumed that failure will not occur.

Contingency planning that exists only in the holder's mind offers little comfort to attorneys. If the holder cannot communicate—because they are dead or incapacitated—the plan in their mind provides no guidance to anyone. Written contingency documentation survives the holder's unavailability and can inform those who need to act. Oral contingency planning dies with the holder or becomes contested memory among those who remain.

---

Third-Party Dependencies

Custody arrangements often depend on third parties: co-signers in multisig arrangements, trusted friends holding backups, services providing custody or recovery support. Attorney questions probe the reliability of these dependencies. Who are these people? What is their relationship to you? What happens if they become unavailable or uncooperative? Are there agreements documenting their roles and obligations?

Informal arrangements with third parties rarely survive attorney scrutiny well. A friend who agreed to hold a key may have no documented obligation to cooperate with an executor. A family member who knows the passphrase may have their own interests that diverge from beneficiaries' interests. A service provider may have terms that limit their obligations in ways the holder never read carefully. Each third-party dependency introduces questions about what actually binds that party to perform their expected role.

Conflicts of interest emerge under scrutiny that might not be apparent in casual arrangement. A co-signer who is also a beneficiary has interests that might conflict with other beneficiaries. A family member holding access information might prefer certain outcomes over others. Attorneys are trained to spot these potential conflicts and to question arrangements that create them. Even if the holder trusts everyone involved completely, the attorney sees structural vulnerabilities that trust does not eliminate.

---

Consistency and Contradictions

Professional questioning often reveals contradictions the holder did not know existed. Documents prepared at different times may describe different arrangements. Verbal statements may conflict with written records. What the holder remembers may differ from what they documented. These inconsistencies undermine confidence in the entire arrangement because they suggest that the holder is not fully aware of what their custody situation actually is.

Cross-examination style questioning exposes these contradictions efficiently. The attorney asks about the arrangement in general terms, then asks specific questions that should have consistent answers, then compares those answers. A holder who says they have "one backup" but then mentions multiple backup locations has contradicted themselves. A holder who describes a simple setup but then reveals passphrase requirements and multisig elements has shown the arrangement is more complex than initially presented. Each contradiction reduces the reliability of everything else the holder has said.

Contradictions often emerge not from dishonesty but from the holder's own uncertainty about what they have actually done. Years may have passed since setup. Changes may have been made and forgotten. Different components of the arrangement may have been created at different times without being reconciled. The attorney's questioning forces the holder to confront the gaps and inconsistencies in their own knowledge, which can be uncomfortable but is less uncomfortable than discovering these issues in a legal proceeding.

---

The Gap Between Functioning and Defensibility

A custody arrangement can function well for the holder's own use while being poorly defensible under scrutiny. The holder knows their own passphrase, remembers where things are stored, and can navigate their own setup. None of this matters when the question is whether someone else can establish rights or exercise authority over the bitcoin. The functioning arrangement and the defensible arrangement are different things, and attorney questions address the latter.

Defensibility requires that someone other than the holder can understand and prove what the arrangement contains. If everything depends on the holder's knowledge and presence, then nothing survives the holder's absence in a form that can withstand challenge. The arrangement may have worked perfectly for a decade, but if the holder dies and no documentation exists, that decade of successful functioning provides nothing to the people who must establish what the arrangement was and who has rights to what.

This gap between functioning and defensibility surprises many holders. They have interacted with their bitcoin successfully for years; surely that demonstrates the arrangement works? But an arrangement that works when operated by its creator is not the same as an arrangement that can be understood, proven, and operated by others after the creator is gone. Attorney questions probe the latter, and the holder's experience with the former provides no relevant evidence.

---

Scenarios of Failed Scrutiny

An estate planning attorney asks a client about their bitcoin holdings during a routine review. The client explains they have a hardware wallet with their bitcoin on it. Where is the documentation of that ownership? There is none. Who inherits it under your will? The will does not mention bitcoin. How will your executor access it? The client has not thought about that. In fifteen minutes of questioning, what the client considered a well-managed asset has been revealed as a gap in their estate plan that could create significant problems.

During a divorce proceeding, one spouse claims the other has hidden bitcoin assets. The spouse denies this, but when pressed for documentation of all financial accounts and assets, they cannot explain where the bitcoin is, how much exists, or provide any records. Their custody arrangement functioned through their own memory and undocumented storage. Under adversarial legal questioning, the absence of documentation looks like concealment whether or not it actually was.

A beneficiary questions whether the executor properly administered bitcoin held in an estate. The executor claims they did everything correctly but has no documentation showing what the bitcoin arrangements were at the time of death, what steps they took to secure it, or how they arrived at the distribution they made. The beneficiary's attorney asks pointed questions the executor cannot answer with documentation. What seemed like adequate handling when done informally becomes indefensible under scrutiny because nothing proves what actually happened.

---

Outcome

The question of whether bitcoin custody can survive attorney questions addresses defensibility rather than mere functionality. Attorney scrutiny probes for documentation, evidence of authority, contingency planning, third-party reliability, and consistency—areas where casual arrangements often prove inadequate. What works well enough for the holder's own daily use may appear fragmented and vulnerable when examined by someone trained to identify gaps.

Professional questioning reveals contradictions and assumptions the holder may not have recognized. Years of successful operation provide no evidence when the question is whether others can understand, prove, and execute the arrangement after the holder is unavailable. Functioning and defensibility are different qualities, and attorney questions address the latter without being reassured by the former.

Arrangements that fail attorney scrutiny are not necessarily bad arrangements for the holder's personal use, but they carry risks that become visible only when someone needs to establish rights, prove authority, or defend actions under adversarial conditions. The gap between the holder's sense of adequacy and an attorney's identification of problems reflects different frames for evaluating the same arrangement—one based on whether it works, the other based on whether it can be proven and defended.

---

System Context

Examining Bitcoin Custody Under Stress

How to Explain Bitcoin Custody to Attorney

Bitcoin Estate Executor Checklist

← Return to CustodyStress