Bitcoin Forum

Hi all,
i'm pretty new to bitcoin but already using it and also experimenting with new ideas/code. Great concept!

Anyway i wonder what happens with lost coins?
Like when some people with many coins lose their wallet file.
Are they lost forever, and worst for the whole system? Since the generation of the coins are limited as i have read, are those lost coins regenerated at some point too?

So when many people lose their files, maybe through a terrible bug.. well go figure.

Can somebody please explain what would happen and if there are already methods to prevent or something(except backing up, but it's not always possible, e.g. a bad government takes your computer..).
Ok, in RL life, when you lose money it's also forever lost(when noone finds it). But since in BC it's a limited generation of new coins it looks different i think, or am i missing something?
Maybe one solution would be that the network will also forget about those coins when the original node/node with that wallet/ID haven't connected for a very very long time(maybe ~40, ~100 years? on the other hand it might be bad for descent to your child who will knew about your "wallet file" very late etc.) and let's the network regenerate those coins.

Well, i'm not really sure how this is working yet, but just thought about this. Maybe someone can explain/think about this who has more knowledge of bitcoin/it's economics. :)

Thank you.

Once lost = forever lost.
we call it "natural deflation".

the lost coins wont be recovered or regeneratet at any time.

It's really not so bad for the system--just unfortunate for the user who lost his bitcoins.
The value that those bitcoins held is never really lost.  Rather, it's essentially redistributed out to every other bitcoin still in use (deflation).
Even if we lost 90% of BC and only had 2.1 million, with the eight (i think) decimal places possible, it would still be perfectly practical to use.

Thank you both.
Already thought so and sounds logical.

One thing i was afraid of, is especially because of this, it would be possible by a bad gov or other bad third parties to still influence the system.
Either by (bad) gov:
- seizing/sueing all IP's which are nodes(easily detectable because of TCP and default port right now)

or other bad guys when they might have a lot of BC so they have an advantage/higher value of their coins:
- writing a worm which infects and deletes wallet files (generally i see a new sort of phishing here, either stealing wallets or automated transfers by worms, but that's another thought/story to keep care of soon :) ).

or other similar ways.

So that was my only thought behind all this.

Someone who had a lot of coins probably wouldn't want to do things that might make people flee the system. That doesn't rule out mindlessly malicious attacks though.

Agreed, the danger isn't necessarily from those trying to exploit the system (though the coin phishing and such is a valid concern), but rather from those seeking simply to destroy it. What do you do when a powerful adversary puts a few supercomputers to block generation and they intend to screw around with the block chain? They might not care about stealing value; they'd rather just destroy it.

... like how the RIAA screws around trying to disrupt BitTorrent swarms...

Umm, good luck with that.  I'm betting The Swarm will win most of the battles.

I don't think it's directly comparable. There's no such thing as a "Bittorrent proof of work" that serves as the base for all value in the system. The CIA, Botnet, whoever directly attacking the proof of work is a valid scenario.

Of course, they would need to have a pretty hefty supercomputer to keep up with 1 million + nodes, should Bitcoin get to that point.

And if BC gets to that point, well, that's what you call a good problem to have.  Nothing like a large number of users testing the scalability of your architechture.

Yeah, that would be a good problem to have.

Why would they mess around with the block chain, though?  Are you imagining the men in black double-spending enough Bitcoins to make merchants think it is untrustworthy? ("I shipped 100 computers to Langley, Virginia when the transaction had six confirmations, and now there's a new block chain that says those coins were paid to somebody else!!!")

That could be one reason. There is a lot more at stake here (for the big players) than there was for BitTorrent. BitTorrent helps some users get around expensive CDs and DVDs; a costly problem for the industry to be sure, but one that still hits a fairly segmented part of the economy. Bitcoin, on the other hand, has the potential to undermine the entire taxation & fiat money system. You can bet your bottom dollar that a lot more resources will be thrown against it; I'm just waiting for the propaganda campaign to start ;)

I could be wrong, and they won't care or won't notice, or when they do it will be too expensive to mount an attack, even for them, but we need to at least acknowledge the possibility.

My point was that if "they" mount an attack, I think they're unlikely to do something subtle like try to mess with the block chain.

If "they" want to mess with the network, it would be far easier to do something like what China's doing with its Great Wall-- forcing connections they don't like to be dropped.  Or what botnets do now:  mount a denial-of-service attack by flooding the network.

Much more likely:  "they" will catch you for tax evasion when you convert your bitcoins to your local fiat currency and buy that fancy sports car you've always wanted.

Two words for you... Liberty Dollar.

If they want to take bitcoin down, they will go after people directly.  The beauty of the idea, of course, is that it's a system that is easily replicated if they are, in fact, successful in 'taking it down.'  Welcome Bitcoin 2.0.

Well, if somehow EVERY coin is lost, the network can just start block generation from the start all over again.

That wouldn't exactly inspire confidence in a second go-around for the exact same idea.

Yep, I don't doubt those tactics will be tried as well. The first two are temporary, but the last one is scarier to potential users. The devs might find black SUVs pulling up to their doorsteps one day, as well.

Sure, of course it wouldn't make any sense for the attacker to delete almost all wallet files, but he could implement an algorithm in his worm, which deletes...well, maybe every 50th wallet file and also to prevent that it doesn't look like just attacking computers with installed bitcoin, he can just delete/kill the whole system. So in the end he was still able to influence the network/economy.

And at least to prevent stealing wallet files for now, the file should be password protected(decrypt at every bitcoin start and encrypt again when closing). Should be no real problem to implement. Still phishing on a running bitcoin would still be possible by hooking (or even easier just by mousmove/key-macro..) and also can't think of any real/good prevention of this for now(but probably affects mostly the windows version).  :-\

Hopefully bitcoin becomes its own supercomputer. :D

As long as it doesn't become self aware (as computers often do) and then it will know what I've been spending my Bit Coins on.  ;D

To be fair, it really does depend on the company you are buying your 'fancy' car from. Lamborghini being one car dealership that accepts Bitcoin directly; we are all familiar with the phrase 'when Lambo'. ;D Also, if buying in fiat currency, the minute your transfer goes through the bank, "they" can directly trace the money afterward. So when converting to any fiat, you are beholden to the laws of the country whose currency you are converting to.

i think although we transaction to buy lambo by using bitcoin is not free of taxes, but for a letter of ownership will certainly be a question about your income so far to buy lambo, and finally the government can track it as well

There are two things regarding this matter. When we say that coins are lost then its not the coin actually but access to the coins is lost. that could happen as result of lost private keys, passwords etc. The other thing is, if they are locked away like that then it doesn't mean that they are gone forever. They still stay in the wallet and are reasonably will stay their as its impossible to hack any crypto currency wallet.

When coin is mined then it goes into the block of chain and it stays there forever. So nothing is lost really. However depending upon the number of coins it can affect the price movement.

This is true, coins are not lost completely, but only access to them is prevented at a given moment. If user lost password of his wallet and there is no way to crack it in any way, this does not mean that it will not be possible in the future. Therefore, you do not have to lose hope in such cases, save your wallet data in safe place, maybe one day someone manages to break the password and gets a nice surprise.

In case you lose a private key or wallet is completely wiped out, then coins will be maybe forever lost on blockchain - maybe some day there will be method to somehow "rescue" such coins, but this in now only science fiction.

That goes without saying, as the government would want to know who the unidentified person is, who is suddenly buying a Lamborghini straight up.

I think those "lost coins" are lost forever and not regenerated for everyone to have. It's like if i don't touch my holding, will i have to worry about the system getting it from me? I don't think so. So the lesson is, never lose your passwords and keys into your wallets. Have analog back ups for your passwords and codes and stuff to get in.

For lost coins, like when they lose their wallet.dat or private key and forgot where they stored their BTC, then nothing we can do about it. I had the same idea as you wherein untouched coins for a period of time are handled by the system but it will be unfair for those who just want to HODL long and also I don't think BTC is built that way. If just forgotten password, I believe there are third party services for retrieval using bruteforce method.

It may be healthy for the whole system if you think. If there are fewer coins, the price goes up, compensating the loss.

It's really not so bad for the system--just unfortunate for the user who lost his bitcoins.
The value that those bitcoins held is never really lost.  Rather, it's essentially redistributed out to every other bitcoin still in use (deflation).
Even if we lost 90% of BC and only had 2.1 million, with the eight (i think) decimal places possible, it would still be perfectly practical to use.

That was the thing that you need to protect all of your item even your wallet safely, cause no one will get responsible for it. Once you lost your coins doesn't matter how much is it you wont get it back. That's what makes bitcoin was so risky, so be intelligent to face the challenge.

I heard tons of that like stories, when people figured out the recent price and look for their old wallets, but forgot the passwords etc.

In simple terms, the coins would only be lost to the owners. The system would assume the coin is in circulation!

No one could retrieve if there is lost coins unless the owner is still alive and know the password or the private keys of his accounts and wallets. If the owner dies and the coins will lost forever and no one will benefit on it.

That's right, lost coins is lost forever unless the owner will retrieve it. But when he lost his account's password or private keys then that should do it, it will be lost totally.

If you lose your coins they are lost forever. How that will affect the coin decades to come, who knows. That's why I like the idea of some inflation in the coins. Where new coins are generated and can be mined, per year. Because some people will lose their coin. Just look at Bitcoin.

Yeah it's gone forever dude, cryptocurrencies system is not like a banking system that what ever bad will happen to your bank account you can always prove to them that you are the owner of that bank account by showing them all the proof they want.
In cryptocurrencies system no one will hear you about your proofs.

most of the time, it is human error, once you lost your password or account details, then it is already a lost on your part but not with the system, your lost coins will remain in the system that leads to deflation, those amounts will add up on the current market cap and stays there, no one can get it just like in banks, it will just float in the systems and will only used for dormant funds.

Bitcoin is controlled by anonymous people, it means it you make an error you cannot retrieved it anymore. In order to avoid those error or incident, first always double check all the info before you click specially if your going to use your wallet address. Back files is not enough as much as possible make at least 3-5 back up files so that you have a lot of sources when you need it, and the most important is never share your private keys and email to a person that you don't know.

Yes, the price will continue to rise if fewer coins will be left, but it's so sad knowing those lost coins will give owners wealth but can't really recover whatever ways they tried. Anyway, moving forward I just hoping for a greater price as time passes by.

Yes I think once you lost your coins you’ll lose evrything as well. No one has created something that can return back or at least give you a hint on how to get it all back once you lose the file or something. So the best thing you should do to prevent it from happening is to keep it somewhere you know it would be safe to prevent from hackers and just like me I do it old school style so I write everything on a small notebook and keep it somewhere I am the only one who knows where it is.

This is really an interesting thought, I also once asked what happens with a wasted coin (stored in the wallet, and we forget his password). I think the coin will stay there forever, as long as no one can access it then the coin will remain there I think.

Coins once lost is lost forever.It would remain just idle for years.There is no other way to recover it except retrieving the private keys.Already coins worth millions of dollars have been lost in this way.

At the moment they can't be returned. I read a couple of months ago about the company that is developing a product that will allow the lost bitcoins to be returned. If someone finds the name of the company - write here.

Lost coin is forever lost you can't be recover again so you must be responsible in keeping your private keys and your passwords so that no one can stole it from you .

I don’t think that bitcoin will ever be lost or will ever be faded away because I strongly believe that bitcoin is very sustainable crypto currency and it will going to last for further many decades. And if we look at the past of bitcoin since year 2008 , bitcoin has made a great success, from the valuation of 10₹ to current valuation of ₹ 400000 , the success simply indicated by these increased valuation and I believe that this will further success more and will surely end up to be currency of the world.

Those lost COINS, like lost money, will disappear forever and will not be found by anyone.

By some estimates, nearly four million bitcoin have disappeared forever. So we must keep our wallets.

Or maybe you go try to find it since you are the one who brought it up? You're the one with the most chances of finding it since you've already found it once. Maybe it's still in your browser history?

I do doubt that such "company" is able to recover lost bitcoins because to be able to gain access to the wallet again, you're going to need the private key of it. If you such company can give you back the private key of your address by simply pinpointing which address have you had before, then I will be extremely terrified. That means that they are able to get the private key of any address so they are pretty much going to be like Gods in the bitcoin world. They are just going to search the top wallets that have the most coins and get the private key of those addresses. Good thing bitcoin was made so noone will have the computing power and storage to be able to do that. So nope, that company is a fraud and what they are claiming is impossible.