What exactly is a Bitcoin dead man’s switch

A dead man’s switch is a mechanism that transfers information or authority if you stop performing a regular check-in. In Bitcoin self-custody, that information is typically a way to spend coins: a seed phrase, a passphrase, a set of multisig keys, or a pre-signed transaction that becomes valid after a certain time. The core idea is simple: while you are active, nothing happens. If you are inactive for a set period, the system gives your beneficiaries the keys or the means to recover your Bitcoin.

A solid design should meet three goals: security against early or unauthorized access, reliability under stress, and legal clarity for heirs. The switch must not leak secrets prematurely, it must work when needed, and it must align with Canadian estate processes so your family can use it cleanly.

Why Canadians need a tailored approach

Canada’s climate, banking norms, and estate procedures shape how you build a dead man’s switch. Cold winters and humid summers stress paper backups and electronics, rural mail delays change check-in rhythms, and provincial estate rules influence how instructions are executed. In practice, your plan should account for where you live, which financial institutions you use, and how your executor will handle digital assets during probate.

• Estate process: Your executor will likely need a clear inventory of wallets and instructions. Ambiguity leads to delay and risk.
• Banking and storage: Safety deposit boxes, provincial ID requirements, and rural access all affect where you place backups.
• Weather and disasters: Fire, flooding, and freeze-thaw cycles can destroy paper or cheap metal. Opt for resilient materials and diversified storage locations.

Threat model first: what can go wrong

Before choosing tools, map out risks. A good dead man’s switch balances convenience and safety across realistic scenarios.

• Premature disclosure: A spouse, colleague, or service gains access while you are alive. Result: theft or coercion.
• Never triggering: You lose the ability to check in, yet the system fails to release information because a device, service, or person did not act.
• Data loss: A house fire or basement flood destroys the only copy of a seed phrase or passphrase.
• Coercion or extortion: An attacker pressures you or your family to reveal secrets.
• Legal blockage: Heirs have the data but no clear authority, which complicates liquidation or transfer during probate.

Tip: Start small. Prove your design with an amount you can afford to lose, then scale.

Design patterns for a Bitcoin dead man’s switch

1. Human check-in with sealed instructions

This is the simplest pattern. You maintain a periodic check-in with a trusted person or executor. If you miss a defined number of check-ins, they open sealed instructions that guide recovery. The instructions might reveal a BIP39 passphrase, one key of a multisig, or the location of metal backups. Use tamper-evident envelopes, write dates on the seals, and keep backups in separate physical locations.

• Pros: No reliance on online services. Easy to understand. Works in low-tech contexts, including rural Canada.
• Cons: Human error risk. Requires careful selection of trusted people and clear training.

2. Multisig with decaying thresholds

Use a 2-of-3 or 3-of-5 wallet where you and your beneficiaries hold separate keys. During your lifetime, you maintain spending control by holding a majority of keys or the passphrase protecting them. For the dead man’s switch, one key can be held by a lawyer or corporate trustee in a sealed manner. If you become inactive, beneficiaries obtain that key via documented procedures and reach the spending threshold.

• Pros: No single point of failure. Theft of one key is not enough.
• Cons: Complexity. Requires careful setup, device diversity, and clear written instructions for heirs.

3. Time-locked vaults and pre-signed transactions

Time locks can delay spending. You can create a vault structure where immediate spending requires multiple keys, while a delayed path allows beneficiaries to spend after a specified block height or date. Pre-signed Partially Signed Bitcoin Transactions (PSBTs) can be prepared to move funds to an inheritance wallet at a future time, then stored offline with clear instructions.

• Pros: Strong defense against fast theft. Provides a predictable path for heirs after a delay.
• Cons: Technical. Requires disciplined documentation and periodic updates if addresses or plans change.

4. Shamir or passphrase release

If you use a BIP39 passphrase, you can distribute shares of that passphrase using Shamir Secret Sharing so that no single person can reconstruct it. For example, 2-of-3 relatives can reconstruct the passphrase only if the inactivity threshold is met and they follow your instructions. Combine this with sealed envelopes, distinct geographic storage, and time-based instructions.

• Pros: Reduces risk of a single compromised person. Resistant to theft of one envelope or one location.
• Cons: Share management and recovery require rehearsals. If heirs are not trained, mistakes happen.

5. Self-hosted heartbeat with offline release

Advanced users can run a small server that expects periodic heartbeats from you. If heartbeats stop, the server releases an encrypted package to designated recipients. The encryption key is split and stored offline so the package is useless until beneficiaries assemble the key from physical backups. This avoids trusting a third-party online service, while still automating the trigger.

• Pros: Automation without custodial services. Flexible and private.
• Cons: Maintenance overhead. You must monitor the server and ensure heirs can complete decryption when needed.

A practical step-by-step blueprint for Canadians

Step 1: Inventory your Bitcoin and choose the custody model

List your wallets, approximate balances, address types, and where backups live. Decide between single-sig plus passphrase or a multisig layout. For many families, 2-of-3 multisig provides a good balance: you hold two keys during life, while a third is sealed with a professional or stored in a distinct location for beneficiaries.

Step 2: Create high-entropy keys and write a plain-language letter

Generate seeds on trusted hardware wallets and avoid internet-connected generation. If you use a passphrase, ensure it is long and unique. Draft a letter for heirs that explains, in simple terms, where the backups are, which devices are needed, and who to contact. Avoid technical jargon. State clearly that the instructions are for use if you are incapacitated or deceased.

Step 3: Build the dead man’s switch trigger

Pick your trigger method. For beginners, a quarterly human check-in is reliable. Using a calendar, you send a simple signal to your executor. If you miss two consecutive signals, they open the sealed instructions. For advanced users, consider a self-hosted heartbeat with an encrypted payload that requires assembling multiple physical key fragments to unlock.

Step 4: Add a delay to protect against coercion

If you are worried about threats, use time locks or a staged approach. For example, your heirs receive instructions to access a vault that only becomes spendable after a defined delay. The delay reduces the value of coercion, since an attacker cannot immediately spend even if they get the instructions. Document the delay mechanics in plain language for your beneficiaries.

Step 5: Store backups in Canadian-resilient ways

Use corrosion-resistant metal backups for seed phrases, and consider two or three locations with different risk profiles. A safety deposit box may be suitable for one copy, while a private, fire-resistant safe in a different dwelling can hold another. If you live in a flood-prone area, ensure at least one backup is stored above ground level. Keep locations in the same province when practical to simplify executor access, and document the exact retrieval steps.

Step 6: Rehearse a recovery with a small amount

Run a live fire drill. Move a small amount of Bitcoin to your inheritance setup, then walk a trusted family member through the recovery process using your sealed instructions. Confirm they can construct a transaction, sign it, and broadcast from a clean computer. Afterward, reset any opened envelopes and rotate any exposed secrets.

Step 7: Document your estate roadmap

Write a concise roadmap for your executor and beneficiaries. List contacts, device PINs stored separately, and the exact steps to follow. Include a section explaining how to verify addresses, how to detect phishing, and what to do if a hardware wallet fails. Store a printed copy with your will and keep a sealed duplicate in another location.

Step 8: Set a maintenance calendar

Your plan should evolve. Use an annual date, such as January 3, to review your setup and rotate any keys you wish to refresh. Confirm addresses, pre-signed transactions, and time-lock settings still match your intentions. If you move homes or change financial institutions, update the storage locations and instructions immediately.

Security hardening for Canadian conditions

• Device diversity: Use different hardware wallet models or at least different production batches. Store one device powered off in a Faraday bag to reduce metadata leakage.
• Anti-tamper packaging: Use numbered, tamper-evident bags for envelopes or USB devices. Record serial numbers in your roadmap.
• Metadata minimization: Avoid labeling envelopes with “Bitcoin seed.” Use neutral labels like “Estate Document A.”
• Geographic spread: Place backups in locations with different risk profiles. Urban high-rise vault plus suburban safe is better than two backups on the same street.
• Environmental resilience: Choose metal backups rated for high heat and corrosion. For northern climates, avoid moisture traps that condense and rust.
• No single insider: If using a professional, ensure they cannot alone spend funds. Combine their role with a family key or a time delay.
• Watch-only oversight: Maintain a watch-only wallet so you can monitor balances and transactions without exposing keys.
• OPSEC for communications: Keep estate emails and messages boring, short, and without wallet details. Sensitive instructions belong on paper, not in inboxes.

Canadian legal and tax context at a glance

This article is educational only and not legal or tax advice. In Canada, Bitcoin is generally treated as property for tax purposes. On death, there is usually a deemed disposition that can trigger capital gains. Your executor may need to account for cost basis, fair market value at the date of death, and subsequent transactions. Proper documentation and a clear inventory help your executor work with tax professionals more efficiently.

From a practical standpoint, give your executor the tools to prove lawful control without exposing spend authority too early. Provide a copy of your roadmap with the will, and a sealed package containing the final key material that should only be opened once the conditions in your dead man’s switch are met. If a corporate trustee is involved, clarify in writing that they hold an inert component of a larger scheme and cannot act unilaterally.

Note: Some families create a separate, labeled inheritance wallet. Keeping inheritance funds in a dedicated structure simplifies probate, tracking, and eventual distribution.

Common mistakes and how to avoid them

• Storing everything together: Keeping seed, passphrase, and roadmap in one safe defeats the point. Spread them across multiple protected locations.
• Over-automation: Relying entirely on an online service can fail at the worst moment. Prefer human-readable, offline instructions plus redundant triggers.
• No rehearsal: Beneficiaries have never touched a hardware wallet. Run a 30-minute dry run so they can succeed under stress.
• Ignoring time: Pre-signed transactions or vault delays that no longer match your intentions. Review at least yearly.
• Single point of legal contact: Only one person knows where the will or instructions are. Create backups for documents and inform at least two trusted contacts.
• Ambiguous language: Technical jargon without definitions. Write for a non-technical reader and include a glossary.
• Unverified hardware: Not checking device authenticity or firmware. Verify on first use and record steps taken.

A complete checklist you can adapt

• Decide on custody: single-sig plus passphrase or 2-of-3 multisig.
• Generate seeds offline on authentic hardware wallets.
• Create a watch-only wallet for monitoring.
• Write a plain-language roadmap for heirs and executor.
• Choose trigger method: human check-in, self-hosted heartbeat, or both.
• Consider time locks or pre-signed PSBTs to add delay and safety.
• Distribute backups across at least two distinct locations in Canada.
• Use corrosion-resistant metal for seeds and protect against moisture.
• Seal envelopes with tamper-evident bags and record serials.
• Rehearse recovery with a small test amount and debrief.
• Update your roadmap after any move, new wallet, or major life change.
• Set an annual review date to rotate secrets and confirm viability.

Realistic example: the 2-of-3 family plan

Imagine a Canadian family chooses a 2-of-3 multisig. One key lives on a hardware wallet in a home safe. The second key sits in a safety deposit box across town. The third key is sealed with a lawyer, along with instructions that it is only to be released if the executor presents proof that the check-in schedule has been missed for two consecutive periods or in the event of death.

During life, the holder maintains spending control using the home key plus the box key. If incapacitated, the executor obtains the lawyer’s key and combines it with the box key to reach the 2-of-3 threshold. The roadmap includes screenshots of the wallet interface, a glossary, and a step-by-step PSBT signing example, so even a newcomer can complete the process.

Operational excellence: how to test without risk

Set aside a small amount of Bitcoin in a mirror of your primary setup. Practice the entire flow: finding the roadmap, retrieving the right device, connecting to a clean computer, verifying receive addresses, spending with a PSBT, and broadcasting. If anything is unclear, update the roadmap. Record the test date and sign it with your initials so heirs see evidence of recent validation.

Use simple language in your checklists, such as “Step 1: Retrieve Envelope B from Location 2,” followed by photos or diagrams. The goal is to remove ambiguity and reduce stress on a difficult day.

Privacy, safety, and common sense

• Never email a seed phrase, passphrase, or PSBT. Sensitive data stays offline.
• If you must use cloud storage, encrypt files locally with a long key and store that key separately on metal.
• Prefer in-person handoffs for sealed envelopes. Record who received what and when.
• Teach beneficiaries to verify addresses on the hardware wallet screen and to distrust any last-minute changes or new QR codes.
• Remind your family that Bitcoin transactions are irreversible. One careful send beats ten rushed ones.