# Storing cryptoassets safely in the UK — custody guide

You can leave crypto on the exchange where you bought it (easy but risky if the company fails), or move it to a wallet you control (more secure but you must not lose the password). Never share your recovery phrase with anyone — not even 'support staff'.

## Key facts
- Leaving crypto on an exchange = trusting that company completely.
- A wallet app or hardware device puts you in control.
- If you lose your recovery phrase, your crypto may be gone forever — no bank can help.
- UK law now treats digital assets as property you can leave in a will.

## Exchange custody vs self-custody

Leaving tokens on an exchange is convenient but concentrates risk — hacks, insolvency and withdrawal freezes have affected UK and overseas users. Self-custody via a hardware or software wallet gives you control but full responsibility for key security.
## Hot and cold wallets

Hot wallets are connected to the internet (mobile apps, browser extensions). Cold storage keeps keys offline (hardware wallets, paper backups). For significant holdings, cold storage with a tested backup process is standard good practice.
## Seed phrases and backups

Your recovery phrase is the master key. Store copies securely offline — not in email, cloud notes or photos. Consider split backups and informing a trusted person how to access them if you die, without publishing the phrase in your will.
## Digital assets and UK property law

The Property (Digital Assets etc) Act 2025 clarifies that certain digital assets, including crypto, can be treated as property capable of being owned and transferred under the law of England and Wales. This supports including digital assets in estate planning, though Scottish and Northern Irish law may differ — take legal advice for cross-jurisdiction estates.
## Inheritance planning

Document what you hold, where, and how an executor can access assets without compromising security. Use a letter of wishes or secure vault rather than embedding secrets in the will. Executors may need specialist help to value holdings for probate and IHT.

## FAQs
### Is crypto covered by FSCS if an exchange fails?

No. FSCS protection does not apply to cryptoassets held with most exchanges.
### Can I put my seed phrase in a safety deposit box?

Physical offline storage can work, but consider who can access the box and whether the backup format will survive decades.

## Sources

- [Legislation — Property (Digital Assets etc) Act 2025](https://www.legislation.gov.uk/ukpga/2025/5/contents/enacted)
- [Law Commission — Digital assets project](https://lawcom.gov.uk/project/digital-assets/)
- [FCA — Cryptoassets for consumers](https://www.fca.org.uk/consumers/cryptoassets)

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— Digital Assets UK (https://digital-assets.co.uk/storage/safe-crypto-storage/), reviewed 2026-06-23. Source: https://www.legislation.gov.uk/ukpga/2025/5/contents/enacted