The death of Matthew Mellon shows how a lack of planning can cause problems for an estate that contains a lot of cryptocurrency.
At the age of 21, Matthew Mellon, a member of the famous family of bankers, inherited $25 million through a trust that was created for him. Illustrating the dangers of giving that much money to someone so young, Mellon was not cautious with the money and developed a costly habit.
He recently passed away on the way to rehab, at the age of 54. If that was the entire story Mellon would be a good cautionary tale about why it is important to carefully structure large inheritances. However, there is more to the story as the Wills, Trusts & Estates Prof Blog discusses in “Matthew Mellon’s Cryptocurrency is Being Held in Probate.”
At some point, Mellon became heavily invested in cryptocurrency, which eventually made him a billionaire. At the time of his passing, his cryptocurrency holdings are believed to be worth around $100 million. However, the problem is that cryptocurrency can be extremely volatile.
Since his passing, Mellon’s holdings have already fluctuated more than 30% in value. To get the holdings, however, his estate first has to go through probate. This would ordinarily take a long time in this case. The estate is seeking permission to sell the cryptocurrency now, in case the value of the holdings crashes.
Mellon presents another cautionary tale as well. If you have a lot of cryptocurrency, you should make estate plans that do not require cryptocurrency to go through probate.
Reference: Wills, Trusts & Estates Prof Blog (May 20, 2018) “Matthew Mellon’s Cryptocurrency is Being Held in Probate.”