Assets in your existing portfolio are generally easy to add to your current cryptocurrency portfolio. However, assets are held in accounts in various countries. As a result, managing a cryptocurrency trading portfolio can be complex. Who do you want to manage ownership of your assets in your portfolio? Who can trade assets in your portfolio? What laws must be followed in order to transfer assets in your portfolio upon the death of a beneficiary or account holder of a cryptocurrency trading account? Can a debtor’s creditors force the realization of assets in a portfolio of accounts for cryptocurrency trading? Can an exchange account be frozen with assets in it?
There are a number of different ways to set up simple systems of ownership, administration, and distribution by a trust, and we use Nevis trusts together with Nevis LLCs as the simplest form of private wealth planning structure. The trust holds the LLC membership interest as an asset, and the individuals’ cryptocurrencies are held in the LLC's member accounts.
Note: This article is not a tutorial to set up a corporation to serve customers with specific crypto-related services. Many factors influence a person’s choice of a private wealth planning solution that uses a Nevis trust and a Nevis LLC.
Key Takeaways
- You hold the member interest(s) in an LLC in trust, and the cryptocurrency is held by the LLC.
- It is also important to note that the member(s) and the LLC are managed by the same person(s) and therefore hold the same personal signature (private) keys.
- Each of these matters is treated separately under law, including individual member claims versus LLC debt and challenges to a transfer of a member interest(s) by members versus by third parties.
- The matters set out above will not be governed by the structure and the laws of Nevis where such matters are outside of the jurisdiction of the Courts of Nevis and/or involve foreign taxation and/or the assets are held overseas.
- However, you should consider whether additional structures will achieve your goals and remain cost-effective over time to deliver sufficient ongoing value.
- Additional structures (e.g., further trust(s)) would typically be established as separate entities (i.e., not part of the existing structure) and then added to the LLC as and when required.
What Is a Nevis Trust and LLC Structure?
A Nevis Trust is created as a trust under a trust agreement. It is managed by one or more trustees under the terms and conditions of the trust agreement. A Nevis LLC is considered a separate entity from its owners and managers. The majority of newly formed LLCs are intended to be managed by the members of the LLC (the owners) and/or by managers of the LLC.
An example of end-ownership and management for the above entities is shown below.
| Role | Function in the arrangement described here |
| Settlor | Creates a trust and funds it with the required amount. |
| Trustee | Manages the LLC membership interest in trustee capacity and performs actions with the membership interest in accordance with the terms and conditions of the trust. |
| Beneficiaries | The interests of the beneficiaries are dealt with by the terms of the trust. Those interests must be clearly distinguished from the personal interests the beneficiaries have in the LLC's assets. |
| LLC | Owns the crypto and account rights validly contributed or acquired by it. |
| Manager | Person(s) responsible for the LLC and making decisions and taking action with respect to the LLC within the parameters of the Operating Agreement and applicable laws. |
| Custodian or authorised signers | Protects the assets or signs as required under the terms of custody. |
A typical trust deed cross-references an LLC’s operating agreement, the shareholders' signers, and the signers for the exchange accounts listed in the trust deed. The trust deed then lists the specific assets held in each account. A physical hardware wallet holds zero assets.
Why Nevis Is Used for Asset Protection Structures
All of the assets in any structure of assets (whether held by a Nevis International Exempt Trust or by a Nevis LLC) and all liability for debt in such structure of assets are addressed above with respect to fraudulent dispositions to satisfy charging interests, member and manager powers, and debt and other rights of members and their predecessors in interest as members.
However, a single creditor can attack each claim against the entity at the time of a member's succession, even if all other worldwide creditors have pursued and obtained discharge of their claims against all of the entity's assets.
Different claims require different analysis
| Claim or risk | What needs to be assessed |
| Personal creditor of an LLC member | Remedies against membership interest, including by charging order as applicable. |
| Creditor of the LLC | Obligations of the entity itself and its assets, which also remain liable to pay the LLC’s debts. |
| Challenge to funding | Ownership of property transferred to the LLC, validity of transfer, fraud by LLC members, and related insolvency legislation. |
| Creditor of a beneficiary | The beneficiary’s interest, distribution discretion, and retained or exercised powers. |
| Proceeding outside Nevis | Jurisdiction over persons, accounts, administrators, and property affected by proceedings outside Nevis. |
Foreign judgments: a local protection with conditions
The recognition of a foreign judgment within a jurisdiction is dealt with by s 30 of the Trust Ordinance, part of the Trust legislation consolidated (the “Trust Ordinance”). Here, however, for the purpose of recognition and enforcement of a judgment determined under s 30 of the Trust Ordinance in cross-border crypto cases, reference to three different seats is required.
In cross-border crypto cases the three relevant seats are (i) the custodians; (ii) the contractual rights and obligations of the appellants, including the money of their customers held in customers’ accounts; and (iii) the de facto seat of the boards of directors of the appellants. The only reference to a ‘Nevis structure’ in these Grounds of Appeal is here and nowhere else. A ‘Nevis structure’ is not a ‘secret disclosure application’ to move a choice of defendant from one relevant seat to another where the defendant would prefer it to be.
Crypto and Digital Asset Protection with Nevis Structures Of course, issues not covered by the formation documents for a privately held portfolio (e.g., an LLC) should be addressed in long-term notes to beneficiaries. Also, how the custody model handles the signature issues, going back to a distributed copy and handling third-party-held items, is crucial to the successful operation of the portfolio.
The custody model changes the implementation:
| Model | Planning questions |
| Self-custody | Who holds the keys to the user’s data, and what authority do they have? How is recovery managed? |
| Multisignature arrangement | What is the signing threshold, and who holds each key? Can the signers be changed? |
| Exchange or custodian | Will the chosen provider for your Exchange or Custodian model be able to offer the structure of choice as a customer (contractual), and what are their rights if they deny access at some point in time? |
| DeFi, lending or staking | Are the activities with the protocols authorized, are there any counterparty risks or other risks involved, and how do you want to track the records and tax issues? |
Security and ownership must be engineered at the same time. A trust does not help you to recover lost seed phrases. A trust does not help to prevent malicious signatures. A trust also does not help compensate for losses after an exploit.
Holding investments is different from serving customers
Having your crypto assets set up in a structure as an investment is very different from storing them safely and buying and selling as well as brokering (or transferring on behalf of a 3rd party) the said digital assets. Setting up a single-member LLC to hold all your crypto investment capital is very different from obtaining de facto regulatory approval to offer services worldwide and then setting up a local branch in that country to service local customers.
A private LLC in a fund type of structure holding investments in cryptocoins would not be required to register under the Virtual Asset (Amendment) Act 2026 of Saint Kitts and Nevis and the Virtual Asset Business Regulations 2026 (published in June 2026) for virtual-asset businesses to register
Nevis Trust vs LLC vs Combined Structure
| Decision point | Trust only | LLC only | Combined arrangement |
| Ownership | Trustee holds assets under trust terms. | LLC owns assets; members hold membership interests. | Trustee holds membership interest; LLC owns contributed crypto. |
| Succession | Trust terms govern administration and benefits. | Succession to membership interests needs planning. | Trust terms support continuity of the membership interest. |
| Management | Trust terms and trustee powers govern. | LLC documents allocate authority. | Trust oversight and LLC management must align. |
| Custody | Trustee authority must match custody access. | LLC authority must match custody access. | Both layers must be reflected in provider and signing arrangements. |
| Administration | Trust administration and relevant reporting. | Entity maintenance and relevant reporting. | Coordination and continuing costs across both layers. |
There must be some reason to create an additional entity not already covered by the considered entities. To create a governance structure to transfer power to others in the future it would be better to create an LLC or trust instead.
How the Structure Works in Practice
- Ascertain the status of all of the assets proposed to be transferred to the new structure with respect to (i) ownership, (ii) liabilities, and (iii) any outstanding claims in foreign jurisdictions and the current status thereof.
- Confirm current taxation and other government information for the proposed new entity. Confirm the capital required for the formation of the new entity and the classification of the new entity. Outline how income is to be distributed and profits distributed by the new entity. Confirm any activities that the new entity is to conduct that require licenses, etc., and if so, what.
- You must confirm with your lawyer and the acceptance provider that the structure that has been accepted includes the preferred trustee(s), registered office/agent, and other custodial functions as required. Acceptance is not a given and must be confirmed with the acceptance provider.
- Compare the trust deed to the LLC operating agreement and other documents (e.g., management agreement, investment agreement, etc.) to establish who will succeed to give effect to the documents.
- Document Funding: The funding of the new structure comprises a list of assets to be transferred into the new structure together with documentation required to transfer the assets into the bank accounts of the new structure. The asset register is to be updated to reflect transferred assets, and ongoing sign-off is to be obtained from all relevant individuals, with copies of signed documentation retained.
- Draft a schedule in the form of a checklist with documents that need to be signed by all individuals. It will also outline how to access items such as passwords, etc., that need to be updated from time to time. The test data will be a simulated ‘test case’ and will not contain any real data or information.
- Monitor the accounts (eg, bank, investment, etc.) as required and request any updates from the account holder. For trust accounts, ‘roll down’ the trust and vary as required from time to time (e.g., vary the donor, beneficiaries, permitted activities, etc., and/or address etc.).
What should be documented for crypto holdings?
In practical terms this would be a table setting out all of a company’s various crypto holdings, together with (i) evidence of how that company came to acquire each such holding (e.g., as PDFs of online account log-ins and/or physical or emailed copies of the agreement(s) by which it was acquired); and (ii) evidence of the assets’ acquisition (e.g., a copy of the resolution, together with valuation(s) of the assets as at the time of acquisition, executed by the board of (and/or by management of) that company).
Private keys and seed phrases for an asset should not be included in any documentation filed with the Registry and should not be distributed to third parties. This information is used to verify evidence of entitlement to and use of an asset.
Benefits of Nevis Structures for Digital Asset Protection
- In LLCs, all assets are held in the name of the LLC, which helps protect the owner’s (or members’) personal assets from being mixed with the LLC’s assets.
- Authority: Members, managers, independent contractors, and investors of the LLC who may sign on behalf of the LLC.
- This structure outlines how the Member(s) and the LLC will deal with the interest(s) of the Member(s) and the distribution of profits to the LLC’s members. After the death of the Member(s), the business can continue to pay the bills of the business and distribute the proceeds of the trusts created for the benefit of the heirs of the members to the beneficiaries of the members.
- Continuity: How does the LLC carry on the business of the LLC upon the death of, disability of, or removal of one or more of the owners or managers (hereafter an “Authorized Decision Maker”) of the LLC?
- The rights and remedies of a creditor under applicable law.
These forms of ownership typically have high up-front costs and ongoing management and administration costs. Members of an LLC set up through a trust typically are personally liable for all of the obligations of the LLC.
Limitations and Compliance Reality
The fact that a company is incorporated in Nevis, for example, does not necessarily mean that said company will not have to pay taxes. Even appreciated crypto contributed to a Nevis company will be subject to income, trading profits, and distributions to the company's shareholders and may be taxable in many countries.
Disclosures required by US persons in connection with their foreign trust transactions and with their other foreign entities in which foreign persons are beneficiaries or owners. Completion of Form 3520 and possibly other information returns may be required with respect to such entities.
Privacy does not mean invisibility
A registered agent for a trust or other entity structure is typically expected to provide certain information regarding said trust or other structure to parties involved in said trust as well as to all beneficial owners of said trust structure. For customers of a regulated service provider (e.g., a financial institution), similar information regarding said customer is expected to be provided by said service provider, including information regarding the customer’s ownership and the customer’s source of funds.
A custodian or exchange for an Example C structure may decline to establish the Example C structure or agree to do so with certain terms and conditions to the establishment of the Example C structure. Subsequent prospective customers of an Example C service will need to check with the service providers that are being considered to establish whether or not the desired structure(s) for that customer can be established by the provider or providers, and if so, obtain a copy of the acceptance confirmation and required documentation from such provider or providers.
Legal structuring does not remove technical or commercial risk
In addition to establishing a legal structure, additional controls are needed, such as insurance, loss recovery, and future immunity from regulations within the asset holding plan. All of these scenarios can occur (lost keys, key fraud, exchange failure, smart contract failure, liquidation of underlying assets, etc.).
When Nevis Structures Make Sense—and When They Do Not
A combined structure can achieve the key success objectives over time. The capital required to initially ring-fence the new owner’s assets, set up the structures, and administer them as separate legal entities will form the core of the new owner’s capital.
The new structure described is not suitable for anonymous owners or others who want to minimize exposure but retain control of assets transferred to others who may become insolvent within a reasonable time frame. There must be sufficient capital to set up and administer the trust structure on an ongoing basis.
Assess the full continuing cost
Request a detailed and itemized proposal for the services that are needed to form your entity and subsequent services to maintain your entity through the life of the entity, including any changes that need to be made to the entity prior to dissolution/winding up of the entity. The government fee for the formation of your entity is a very small portion of the total cost to form your entity and to maintain your entity through the life of the entity.
Common Structuring Mistakes
- By forming a new entity, all of your assets automatically get transferred to fund the new entity.
- Ensure that all personal affairs of the principal(s) and all affairs of the new corporation are properly recorded and include full and complete details of all transactions, including all receipted documents.
- Failure to consider the implications of any retained powers and the need to analyze and remove them as necessary from the corporate structure and to determine who in fact exercises control of the critical key(s).
- Failure to set up an adequate investment vehicle for customer service as a corporation.
- This would include mistakenly identifying long-term investments as current liabilities of the LLC without fully realizing the extent of liability for the member(s).
- Also include a plan for the succession of the business and stress test the corporation to identify areas where additional recovery is needed.
- However, the funding of an entity that has not yet earned any income does omit consideration of the related tax consequences.
- This assumption is further defined in a chart detailing the main people, assets, services, suppliers, and legal matters the corporation conducts in each country in which it carries on business.
Conclusion
Establish a framework for management, intergenerational transfer, and determining which assets are best managed by whom through a Nevis trust together with a Nevis LLC. Set out the ownership structure, the relevant liabilities, and how these are recognized in countries around the world. Look at asset protection and the methods of asset custody.
Selecting the right entity for your needs is critical, as each structure has unique features, and individuals can be used in different capacities. Different entities are accepted by different banks, and various entities have vastly different ongoing maintenance costs. Seek the advice of competent attorneys in Nevis and the relevant jurisdictions for the structure(s) you are considering.
