Digital Assets in Trusts: Seat and Custody Rules

Choosing a digital assets trust jurisdiction is not the same exercise as choosing a seat for a portfolio of listed securities. A token has no certificate, no register kept by a familiar custodian and, in practice, no owner other than whoever controls the private key. Each legal system answers three questions differently: is the asset property at all, who can hold it for a trustee, and which authority supervises the people doing so. The answers decide whether a trust holding crypto-assets is robust or merely hopeful.

How a seat decides whether a token is trust property

A trust needs identifiable property that the trustee can hold separately from their own. Seats approach this in three broad ways.

Some common-law seats rely on case law that treats crypto-assets as property capable of being held on trust, without a dedicated statute. Others have added legislation that names digital assets expressly. Civil-law systems, including Switzerland, start from their property and securities rules and ask whether a token can be a right that is transferable and assignable to the trustee.

The question matters most at the edges: a token that merely points to an off-chain asset, a wrapped asset, or a coin held in an exchange account that is really a claim against the exchange. The situs of the trust assets is also harder to fix when the asset lives on a distributed ledger with no physical location, which feeds into governing law versus seat.

Swiss DLT law and what it changes

Switzerland adapted its private law to distributed-ledger technology through a package of amendments, usually called the DLT legislation. In plain terms, it allows certain rights to be issued as ledger-based securities and sets rules on how holders of crypto-assets are treated if their custodian becomes insolvent. For a trustee, the practical relevance is that a segregated token holding has a clearer legal footing in Switzerland than in many seats that rely on analogy.

This does not make every token a ledger-based security, and it does not turn the trust itself into a Swiss entity. A Swiss trustee still administers the trust under the Hague Trusts Convention framework, and the deed's governing law remains a separate choice. The strengths and limits of the Swiss option are set out in Switzerland as a trust seat.

Custody licensing: who may hold the keys

Custody is where regulation bites. Two layers need to be separated: the trustee, and the provider that safeguards the keys.

On the trustee side, Swiss law treats trustees as financial institutions. Under Art. 2 para. 1 let. b FinIA (LEFin), trustees sit alongside asset managers, fund managers, fund management companies and securities firms. Under Art. 17 para. 2 FinIA, a trustee is anyone who, professionally, manages a separate estate or disposes of it for a beneficiary or a defined purpose on the basis of a trust deed within the meaning of the 1985 Hague Convention. Art. 3 FinIA describes an activity as professional when it is an independent economic activity carried out to obtain a regular income.

The same Act sets institutional conditions. A trustee based in Switzerland must be a sole proprietorship, a commercial company or a cooperative entered in the commercial register (Art. 18). The management must include at least two qualified persons (Art. 20). Asset managers and trustees must hold a minimum capital of CHF 100,000, paid in cash, with appropriate guarantees or professional liability insurance (Art. 22). Under Art. 61, they are supervised by FINMA, which involves a supervisory organisation that carries out the ongoing oversight. Art. 19 para. 2 adds the duty to manage the separate estate, preserve its value and use it according to its purpose, which is the standard a key-management policy has to meet.

On the provider side, the question is whether the custodian of the keys holds a licence in its own seat, how client assets are segregated, and whether the trustee can reach the assets if the provider fails. Banking and custody rules are covered in banking and custody for trust assets by seat.

The table is a qualitative map, not a ranking. Within each category, individual jurisdictions differ, and the position changes as legislation evolves. For a named comparison, see Switzerland vs Singapore and Switzerland vs Delaware, South Dakota and Nevada.

What the service covers

The service addresses the practical side of holding crypto-assets in a trust. It typically includes:

• Custody method and provider. Comparing self-custody, a regulated custodian and a split arrangement, and testing each against the seat's rules and the trust deed.
• Control of keys and recovery. Who holds which key, how access is split between people, and what happens if a signatory dies, is incapacitated or leaves.
• Valuation and record of holdings. A consistent way to value tokens and keep an auditable record for the trustee's accounts and for reporting.
• Deed provisions for digital property. Clauses on investment powers, delegation to custodians, forks and airdrops, and a trustee's liability for loss of keys.
• Checks on origin. Establishing where the assets came from, so the trustee can meet anti-money-laundering duties under AMLA before accepting them.

Who it suits, and what it does not cover

The situations that most often raise these questions are a founder or early investor who wants to settle token holdings on a family trust, a family whose existing trust has received crypto-assets by gift, and a trustee asked to accept assets it cannot yet custody. For a worked scenario, see a trust holding digital assets.

Example: a family established in Lausanne holds tokens acquired years ago, partly on an exchange and partly on a hardware device kept by one parent. The main risks are not exotic: one person controls the keys, the trustee cannot prove origin, and the deed says nothing about digital property.

The service does not cover the choice or replacement of a trustee, a family succession analysis under French or German law, or a general overview of Swiss trusts. It also does not advise on investing in any token, and it does not promise any outcome. Tax treatment depends on residence, the beneficiaries' countries and the nature of the assets, so it needs an individual analysis.

What the confidential assessment establishes

The assessment clarifies which seat classifies your assets as trust property, whether the custody arrangement would satisfy the supervisor of a Swiss trustee, which reporting and register obligations would follow (see trust registers and privacy), and which deed changes are needed. Fees depend on the structure and are indicated after the assessment.