The world of digital assets is complicated. Understanding how to access, trade, and secure these assets is enough information to fill a book or two. This leads to an already steep learning curve for new users who may inherit these assets upon the passing of a loved one.
Not only can accessing the assets be complex, but you may not be the only one with access to your loved one's assets. Welcome to the world of Decentralized Finance (DeFi for short) and one of its first introductory functions: staking.
How to Inherit Staked Crypto: Traditional vs Liquid Staking
Staking is one of the most popular ways to earn yield on crypto assets, but few people think about what happens to those assets if the owner passes away. While staking can be a powerful tool for compounding returns, it introduces real danger of assets loss when it comes to inheritance.
In this article, we’ll walk through the two primary forms of staking — traditional (locked) staking and liquid staking — and explore what it takes to ensure they can be passed on securely and reliably. Whether you’re planning your estate or helping someone else manage theirs, knowing the difference matters.
🔐 Traditional Staking: Locked but Rewarding
In traditional staking, crypto assets are locked with a validator to help secure a proof-of-stake blockchain. While this earns staking rewards, the assets typically cannot be moved or used during the staking period, and there is often a mandatory “unbonding” delay when unstaking (ranging from a few days to several weeks).
Common Examples:
- ETH staked directly on Ethereum via a validator.
- SOL staked with a validator through SolFlare or Phantom.
- ATOM staked using the Cosmos Hub.
Inheritance Considerations:
Access requires the original wallet’s seed phrase or private key.Heirs may need to interact with validator dashboards, unstaking mechanisms, and network-specific tools.Without clear guidance, unlocking and transferring these assets can be daunting — or impossible.
How Vault12 Guard Helps:
Vault12 Guard enables the secure backup of private keys, seed phrases, and unstaking instructions, even if the original staking setup is complex. By storing all access materials offline in a decentralized, tamper-proof format, Vault12 Guard ensures that heirs can retrieve and unlock these assets when the time comes — without compromising security beforehand.
💧 Liquid Staking: Inheriting Without Lockups
Liquid staking offers an alternative: instead of locking tokens with a validator, users stake through a protocol (like Lido or Marinade) and receive liquid tokens in return — such as stETH for staked ETH via Lido Protocol, or mSOL for staked SOL. These tokens earn staking rewards and remain transferable, allowing holders to use them in DeFi while still compounding yield.
Inheritance Considerations:
Liquid staking tokens are treated like regular ERC-20 or native tokens.There is no need to “unstake” — heirs can sell or transfer the tokens directly.However, the value of liquid staking tokens may fluctuate slightly depending on market conditions (peg risk).
How Vault12 Guard Helps:
Because liquid staking tokens are stored in wallets like any other crypto asset, they can be protected using the same Guard setup. Vault12 Guard secures access to the wallet containing these tokens, and can also store explanatory notes about what the tokens represent and how to use or convert them.
This ensures that even non-technical heirs can understand what they’ve inherited — and how to recover the full value.
⚖️ Traditional vs Liquid Staking: Inheritance Comparison
| Feature | Traditional Staking | Liquid Staking |
| Token Accessibility | Locked until unstaked | Transferable anytime |
| Technical Knowledge Needed | High (unstaking, validator selection) | Moderate (DeFi familiarity helps) |
| Inheritance Complexity | Higher | Lower |
| Smart Contract Risk | Minimal | Moderate (depends on provider) |
| Compatible with Vault12 Guard | ✅ Yes | ✅ Yes |
📘 Best Practices for Inheriting Staked Assets
Regardless of how your assets are staked, inheritance comes down to access and understanding:
- Avoid reliance on exchanges: Custodial services may have inheritance policies (and may not), but if they do, they often require an enormous amount of legal hoops — or worse, a cross-border regulatory nightmare. Not to mention that it depends on the platform staying operational. Self-custody with Vault12 Guard frees your assets’ longevity from all those factors and gives you full control.
- Check compatibility: Due to architectural choices, Vault12 Guard is the only known solution to date for backup and inheritance that is officially compatible with inheriting staking and DeFi positions.
- Secure the keys: Vault12 Guard can store your wallet’s seed phrase, hardware device backup, or passcodes — all offline and under your control.
- Provide context: A secure note in Vault12 Guard can explain staking positions, validator choices, and steps for unstaking or liquidating.
- Test your plan: Ensure your heirs understand the recovery process — or rehearse it with a trusted person while you’re alive.
🧭 Final Thoughts
Whether your assets are traditionally staked or in liquid form, they represent long-term value — and that value deserves a secure, intentional inheritance path. By combining staking strategies with decentralized inheritance planning using Vault12 Guard, you can ensure that your assets outlive you, and remain protected for the people you choose.
Inheritance doesn’t have to be a vulnerability. With the right tools and mindset, it can be a legacy.
