Trust Agreement

Definition ∞ A trust agreement is a legal document that outlines the terms and conditions under which assets are held by one party (the trustee) for the benefit of another (the beneficiary). In the digital asset space, this can pertain to arrangements where a custodian holds cryptocurrency on behalf of an individual or institution. The agreement specifies the trustee’s duties, powers, and the distribution of assets. It establishes a formal fiduciary relationship.
Context ∞ Trust agreements are becoming increasingly relevant in the digital asset sector, particularly for institutional investors seeking secure and compliant ways to hold cryptocurrencies. Discussions often involve adapting traditional trust law to the unique characteristics of digital assets, such as their cryptographic nature and transferability. Future legal frameworks will likely provide more specific guidance on the creation and enforcement of trust agreements for various digital asset classes.