Quick Answer: Under the Inheritance Law 5725-1965, all property belonging to the deceased passes to their heirs at the moment of death, including Bitcoin, cryptocurrency exchange accounts, NFTs, and online financial accounts. There is no separate Israeli digital assets statute; heirs must follow the standard probate process and obtain a succession order or probate order from the Registrar of Inheritance Affairs (פקיד הירושות). Foreign heirs can complete the entire process through an Israeli attorney acting under a notarized, apostilled Power of Attorney without traveling to Israel.

Most Israeli estates contain recognizable assets: a bank account at Bank Hapoalim or Bank Leumi, an apartment in Tel Aviv or Jerusalem, maybe a pension fund. But in 2026, a significant amount of cryptocurrency, digital investment accounts, and online wallets sit in Israeli estates unclaimed. In some cases the heirs had no idea these assets existed. In others, they knew but had no idea how to claim them.

For a foreign heir, the challenge is two-layered: Israeli probate law on one side, each platform's own policies on the other, and you have to navigate both remotely. What follows covers the law, the tax position, and the practical steps.

1. Digital Assets and Israeli Inheritance Law

The Israeli Inheritance Law 5725-1965 defines "property" broadly. Section 1 of the Law establishes that the estate of the deceased comprises all property and obligations held by the deceased at the moment of death. Israeli courts and the Registrar of Inheritance Affairs have consistently treated intangible assets (digital wallets, cryptocurrency holdings, online accounts with monetary value) as estate property under this definition.

There is no dedicated Digital Assets Inheritance Act in Israel. As of 2026, several Knesset proposals have been put forward to codify digital inheritance rules, but none have been enacted. The existing property law framework fills the gap: if an asset has monetary value and the deceased owned it, it forms part of the estate. This means:

  • Bitcoin, Ethereum, and other cryptocurrencies held in a private wallet or on any exchange
  • NFTs with a recognized market value
  • Balances in Israeli fintech apps such as Pepper, Bit, and Max
  • Online stock and ETF portfolios held through digital brokerage platforms
  • PayPal, Wise, and similar international payment accounts with Israeli nexus
  • Online freelance earnings held at payout platforms (Upwork, Fiverr, Payoneer)
  • Cashback balances and loyalty points with ascertainable monetary value

All of these are, in principle, heritable assets under Israeli law. The challenge is practical, not legal: discovering they exist, locating the credentials, and persuading each platform to transfer ownership.

In Practice
Under Sections 1 and 64 of the Inheritance Law 5725-1965, the Registrar of Inheritance Affairs (פקיד הירושות) operates 16 district offices across Israel under the Ministry of Justice. Filing a succession order application costs approximately 538 NIS as of 2026. The Registrar publishes notice of each application in the official gazette Reshumot for a mandatory 15-day objection period before the order is issued. In uncontested cases with complete documentation, the process typically takes 3–6 months from application to order. If an objection is filed, the matter is transferred to the competent Family Court (Beit Mishpat LeMishpachat) and can take considerably longer.

2. Which Digital Assets Appear Most Often in Israeli Estates?

Four types of digital assets come up again and again in Israeli probate proceedings.

Cryptocurrency is the most common and often the highest-stakes. Israel has one of the highest per-capita rates of crypto ownership in the world. Residents hold Bitcoin, Ethereum, and other tokens through local exchanges such as Bits of Gold and Coinmama, as well as international platforms including Coinbase, Kraken, and eToro. Amounts range from a few hundred NIS to holdings worth millions. Without the wallet keys or account credentials, these assets can be permanently inaccessible, not just delayed.

Israeli fintech balances are more routine but still require formal probate steps. Many Israelis bank digitally through Pepper (Bank Leumi's app), Max, or the Bit payment app. These hold balances and sometimes investment portfolios. Every one of them requires a succession order before releasing funds to heirs.

Foreign brokerage accounts create a two-jurisdiction problem. A deceased Israeli might have held foreign stock or ETF positions through Interactive Brokers, eToro, or Trading 212. You face Israeli inheritance law on one side and the platform's own transfer process on the other, and those two systems do not always move at the same pace.

Domain names and digital intellectual property are less common but worth knowing about. A valuable domain registered in the deceased's name, or ongoing royalties flowing to a digital account, form part of the estate. Domain registrars generally accept a succession order as authority to transfer.

In Practice
Locating digital assets is often the hardest part of the process, and there is no central Israeli digital asset registry. Start by reviewing the deceased's email inbox for platform confirmation emails, annual tax statements from exchanges, and account activity alerts. Look for hardware wallets (Ledger, Trezor) among physical belongings; these are small USB-like devices that store cryptocurrency private keys. Search for seed phrases (a 12- or 24-word recovery phrase) written on paper, stored in a home safe, or saved in a password manager. The Israel Tax Authority (ITA / רשות המיסים) receives annual reports on crypto holdings above specified thresholds from licensed Israeli exchanges, but these reports are not accessible to heirs directly. Your Israeli attorney can request relevant data from the ITA as part of the estate administration process.
In Practice: Under Section 88 of the Income Tax Ordinance, cryptocurrency held by the deceased is treated as a capital asset for Israeli tax purposes. The heir's cost basis is the fair market value on the date of death — not the original acquisition price. The Israeli Tax Authority (Rashut HaMisim) requires a formal valuation from a licensed appraiser or certified accountant for crypto holdings above NIS 50,000 before processing the inheritance. Without this valuation, the ITA may use the highest market price in the 30 days preceding death as the estate value. On a holding worth NIS 200,000 at death but NIS 350,000 at its 30-day peak, the discrepancy creates NIS 150,000 in phantom taxable value and an inflated estate liability.

3. The Israel Tax Authority and Cryptocurrency Inheritance

The Israel Tax Authority (ITA) took a clear and consequential position on cryptocurrency in Tax Circular 5/2018: cryptocurrencies are classified as "financial assets" (not currency) and are subject to capital gains tax at the time of disposal. This classification has direct implications for heirs.

Inherited crypto: what is the tax basis?

When a foreign heir inherits cryptocurrency from an Israeli estate, two potential tax events arise:

The transfer at death is generally not a taxable event in Israel. Israel does not impose an inheritance tax or estate duty. The Inheritance Tax Law 5709-1949 was repealed in 1981 and nothing replaced it. The transfer of assets from a deceased person to their heirs is tax-exempt regardless of asset type, including cryptocurrency.

Future disposal is where tax liability arises. When the heir eventually sells, exchanges, or otherwise disposes of the inherited cryptocurrency, capital gains tax applies. The cost basis (the acquisition price used to calculate the gain) is the market value of the cryptocurrency in NIS on the date of death, converted at the Bank of Israel representative exchange rate for that date.

Under Section 91(b) of the Income Tax Ordinance [New Version] 5721-1961, capital gains on the disposal of financial assets by Israeli tax residents are taxed at 25%. Foreign heirs who are not Israeli tax residents may still have Israeli tax obligations on crypto that was held by an Israeli-resident deceased, depending on the specific asset structure and any applicable double taxation treaty between Israel and the heir's country of residence.

Reporting requirements for the estate

The estate administrator, or the heirs acting collectively, may need to report crypto holdings as part of the estate's final income tax return (Form 1301, submitted to the ITA). If the total estate exceeds certain thresholds, a formal estate accounting may be required before distribution to heirs. Israeli estates that include cryptocurrency should file a supplementary schedule (Schedule G to Form 1301) detailing each crypto asset, its NIS value on the date of death, and the exchange or wallet where it was held.

In Practice
Under ITA Tax Circular 5/2018, crypto is a "property right" for Israeli tax purposes. When filing the estate's final return with the Israel Tax Authority, include all crypto and digital asset values as of the date of death, converted to NIS at the Bank of Israel representative rate on that date. For US-based foreign heirs, consult a dual-qualified Israeli-US tax attorney: the IRS may require you to file Form 3520 if the total foreign inheritance exceeded $100,000, and you may need to file an FBAR (FinCEN Form 114) if the total value of foreign financial accounts (potentially including custodial crypto exchange accounts) exceeded $10,000 at any point during the year. UK and European heirs face analogous cross-border reporting requirements in their own jurisdictions.

4. Claiming Crypto and Digital Accounts: Step by Step

The practical process for claiming digital assets from an Israeli estate follows the same legal framework as claiming any other estate asset, but adds platform-specific steps that can be unfamiliar to foreign heirs.

Step 1: Obtain a succession order or probate order

This is the foundational document everything else depends on. The Registrar of Inheritance Affairs (פקיד הירושות) operates under the Ministry of Justice. You apply at the district office for the deceased's last Israeli address. If the deceased lived abroad, use the Jerusalem district office.

Required documents include:

  • Death certificate, apostilled and translated into Hebrew by a certified translator
  • The original will (if one exists), apostilled and translated
  • Identity documents for all heirs
  • Proof of relationship to the deceased (birth certificate, marriage certificate, etc.)

Foreign heirs who cannot travel to Israel should grant an Israeli attorney a Power of Attorney. The Power of Attorney must be signed before a notary in your country, apostilled under the Hague Convention of 1961, and submitted to the Registrar along with the application. Most countries that are Hague Convention signatories do not require additional legalization at the Israeli consulate; the apostille stamp is sufficient.

Step 2: Present the succession order to each platform

Once you have a succession order (*tzav yerusha*, צו ירושה) or probate order (*tzav kiyum tzava'ah*, צו קיום צוואה), you present it to each platform holding the assets:

  • Israeli banks and fintech apps: Contact the deceased's branch with the succession order, death certificate, and your ID. Banks typically process releases within 3–7 business days.
  • Israeli crypto exchanges (Bits of Gold, Coinmama): Email or visit the platform's compliance department with the succession order and a signed indemnity form. Most Israeli exchanges cooperate fully once legal documentation is provided.
  • International platforms (Coinbase, Kraken, Binance): Follow the platform's deceased-user process. Most require a death certificate, the Israeli succession order or equivalent foreign probate document, and a notarized affidavit of heirship. Some require the request to be submitted through their legal department, which can add several weeks.
  • eToro (Israeli-founded, internationally operated): Submit through the eToro support portal under "Deceased Account Holder." eToro's compliance team accepts Israeli succession orders as legal authority.

Step 3: Transfer or liquidate the crypto holdings

Once access is granted, you can transfer the cryptocurrency to a wallet you control (deferring any capital gains event until you sell) or request the exchange liquidate the holdings and transfer the NIS proceeds to an Israeli estate bank account. Liquidating through the estate crystallizes the gain at the estate level; transferring to an heir's personal wallet defers it until the heir disposes of the asset. The tax consequences are different in each case and worth discussing with an Israeli tax attorney before acting.

In Practice
From submitting an application to the Registrar of Inheritance Affairs to receiving a succession order, budget 3–6 months in uncontested cases. The mandatory 15-day publication period in Reshumot is the floor, not the ceiling; processing times vary by district, with Jerusalem typically longer than Tel Aviv. Once you have the succession order, Israeli crypto exchanges generally respond within 2–4 weeks; international platforms can take 4–12 weeks. Budget a total of 6–12 months from first contact with the Registrar to final distribution if you are a foreign heir working entirely remotely through an Israeli attorney.

5. Online Accounts and Passwords After Death

Beyond cryptocurrency, an Israeli estate may contain valuable online accounts: email archives with business records, social media profiles with commercial goodwill, PayPal wallets with balances, and cloud storage containing work product or contractual documents.

Most heirs cannot access the deceased's accounts because they simply do not have the passwords. In Israel, there is no statute compelling technology companies to hand over credentials. Under Section 1 of the Inheritance Law 5725-1965, heirs are entitled to the monetary value of estate assets, including digital ones, but extracting that value depends entirely on platform cooperation.

Google's Inactive Account Manager and Apple's Digital Legacy program let designated individuals access an account after death, but only if the deceased set them up beforehand. Without that, you typically need a court order or formal legal request. Both companies accept Israeli succession orders as legal authority, though the process can take several months.

Platform policies vary widely:

  • Facebook / Meta: Will memorialize or permanently delete an account on request from a verified heir. Full account access requires a court order, but financial data (ad account balances, marketplace funds) is released on a succession order.
  • PayPal: Releases balances to verified heirs on receipt of a death certificate, succession order, and bank details. Processing typically takes 2–6 weeks.
  • Dropbox and cloud storage: Treats files as personal data. You have the right to the contents as estate property, but expect to provide a formal legal request or court order even with a succession order in hand.

One practical note on privacy: the Israeli Protection of Privacy Law 5741-1981 does not erase a heir's property rights, but private communications (emails, chat messages, social media DMs) involve third parties whose interests complicate matters. When you approach a platform, frame your request around the financial value rather than personal content. Courts draw that line clearly, and platforms respond better when you do too.

In Practice
In several district-level rulings issued between 2023 and 2025, Israeli courts held that heirs are entitled to access digital accounts as estate assets, but that the scope of access may be limited to financial data and documents rather than private personal communications. The Israeli Supreme Court (Beit HaMishpat HaElyon) has not yet issued a definitive ruling on this question. An Israeli attorney can petition the Family Court (Beit Mishpat LeMishpachat) or Magistrates Court (Beit Mishpat HaShalom) for an order compelling a platform to release financial data to heirs, though most platforms cooperate voluntarily once a valid succession order is presented and the request is specifically limited to financial assets.
In Practice: Under Section 78 of the Succession Law 1965, the estate administrator has authority to access and manage all estate assets — but cryptocurrency exchanges and digital platforms are not automatically bound by Israeli succession orders unless they maintain Israeli operations. For assets on foreign exchanges, a preservation notice must be sent to the platform by the Israeli attorney managing the estate, citing the succession order, before any Israeli legal authority becomes actionable. This process takes 2-6 weeks per exchange and costs NIS 3,000-8,000 in attorney time per platform. Heirs who act without sending this notice risk the exchange freezing the account and requiring a separate foreign court order to release it.

6. Estate Planning: Protecting Your Digital Assets for Israeli Heirs

The Inheritance Law 5725-1965 does not require digital asset disclosure in a will, but including instructions can save heirs months of frustration and significant legal fees. A few practical steps make the difference.

Start with a digital asset inventory. List every account with monetary value: crypto exchanges, wallets, online banking, brokerage platforms. Include usernames and, in a secure location accessible to the estate administrator, access credentials or recovery instructions. Update it annually; crypto wallets and exchange accounts change.

If you have a hardware wallet, treat the seed phrase like a bearer bond. That 12- or 24-word recovery phrase is the master key. Write it on paper and keep it in a fireproof safe or with a notarized custodian. If the only copy is on your phone and the phone is inaccessible, the crypto is gone permanently.

Under Section 78 of the Inheritance Law 5725-1965, you can ask the Registrar to appoint an estate administrator (*menahel eizvon*, מנהל עיזבון) proactively, or name one in your will. For estates with significant digital assets, choose someone who actually understands cryptocurrency. The administrator's authority under Section 80 of the Law covers digital property explicitly.

Your will can reference a sealed, notarized document with account details and access instructions without listing them openly in the probate record. A clause directing the executor to "the sealed asset schedule held by my Israeli attorney" is legally effective under Israeli will law and keeps sensitive credentials private.

For large crypto holdings, a multisig wallet is worth considering. Multi-signature setups require more than one private key to authorize a transaction. A 2-of-2 or 2-of-3 arrangement, where the estate administrator holds one key and you hold another, means heirs can access the crypto without having to locate your key after death.

In Practice
Under Section 25 of the Inheritance Law 5725-1965, a will is valid even if it does not enumerate every asset. Leaving "all my property" to a beneficiary is sufficient. A practical supplement is a notarized Asset Statement (*tikun nechassim*, תיקון נכסים), a sealed inventory of assets including digital ones, provided to the estate administrator or Israeli attorney before death. The Ministry of Justice does not maintain a digital asset registry, so this private document is often the only mechanism that ensures your crypto holdings are discovered and correctly distributed. A licensed Israeli notary will typically prepare and seal an Asset Statement for approximately 300–800 NIS depending on document length and notary rates.