[DISCUSSION] What will happen to the "lost" bitcoins?

[Z-tight]

They are lost to a good cause, basically.

I wouldn't really put it in this way, despite the fact that as Satoshi said: they make everyone's coins worth slightly more. However, you cannot call it a good cause when people lose their private keys or seed phrase and cannot recover their funds, or when people lose their hard drive, like James Howells did, and can no longer recover their coins, it is sad for the victims and unfair on them to call it a 'good cause'.

[bizeodal]

I've always had a big question about the bitcoins in wallets that were lost over time

This is a FAQ
https://en.bitcoin.it/wiki/Help:FAQ#But_if_no_more_coins_are_generated,_what_happens_when_Bitcoins_are_lost?_Won't_that_be_a_problem?

[Issa56]

What could happen to these lost bitcoins? Will they continue to be lost in "limbo"

I don’t think anything will happen to lost bitcoin, as long as your bitcoin is lost, then it’s going to be lost, and I don’t think there is any means by which lost bitcoin can be recovered. That’s why we are supposed to properly secure our bitcoin, we should make sure we make use of the right wallet to store our bitcoin, and we should properly secure our wallet private key.
 
There are some scammers that do claim they can recover lost bitcoin. If you lose your bitcoin, it’s better you just move on, but don’t even try to pay anyone to recover your lost bitcoin for you because they are just going to scam you, and your loss will be more. There is nothing like a bitcoin recovery service after losing your bitcoin.

[nelson4lov]

Those coins are lost. As the term says, unless the owners of those Bitcoins manages to find the keys to their wallet and retrieve those coins, then it's gone forever. Bitcoin isn't just some small network that can be forked off to retrieve all lost coins. If anything, those lost coins reduces the supply which most economists will agree that is good for the tokenomics and demand.

The popular phase — "Not your keys, not your crypto" can be rephrase to me "Your crypto, your responsibility". So if you lose it, it's not the chain's fault.

[tbct_mt2]

The popular phase — "Not your keys, not your crypto" can be rephrase to me "Your crypto, your responsibility". So if you lose it, it's not the chain's fault.

It is true if you say "It's not your keys, it's not your bitcoins" but it can turn to be untrue if you say "It's not your keys, it's not your crypto".

Because altcoins with smart contracts can help governments, developers to seize your altcoins, tokens in your own non custodial open source wallets too. They can use smart contracts for doing this. So with altcoins, if you have private keys, mnemonic seeds, it does not mean you own altcoins.

https://chainsec.io/nyknyc/
Bitcoin Q&A: Not your Keys, Not your Coins
PSA: Most Stablecoins Can Be Frozen, Even in Your Own Wallets

[BlackHatCoiner]

The circulation limit of the asset will not be just 21 million (value estimated by the system), it will be 21 million minus the bitcoins lost in wallets, which according to studies, is almost 4 million lost coins.

There are no "studies". There are less than 5 thousand bitcoin provably lost; the rest are just bareless speculation. 4 million is extraordinary, even with bareless speculation. Where did you find that number?

What could happen to these lost bitcoins? Will they continue to be lost in "limbo"

If you refer to non-provably lost (AKA, speculation), then either their owners will find access, or they will remain lost for a very long time. Those with public keys exposed can be brought into circulation when ECDLP can be solved within a reasonable time by quantum computers.

I don't see the problem with coins being lost, though. The quantity of money does not matter. Even with just a thousand bitcoin in circulation, it can still be traded and used as money.

[Nwada001]

When something is lost, it means you can not have access to it again, unless you luckily find what can grant you access to what you have lost. The possibility of losing your Bitcoin is if you no longer have access to your private key and it was an act that was very common years back, probably because Bitcoiners of that time didn't know that Bitcoin will become very appreciative to what it is today.

When something is lost, in some cases there are always chances of getting it back if there is careful retracing. The same is applicable to bitcoin.
 
Someone can lose access to their holdings today and still regain access to them again in times to come. Only those coins that are sent to the burn address are what I consider to be what's lost forever.

[Wonder Work]

When something is lost, in some cases there are always chances of getting it back if there is careful retracing. The same is applicable to bitcoin. Someone can lose access to their holdings today and still regain access to them again in times to come. Only those coins that are sent to the burn address are what I consider to be what's lost forever.

If the lost thing is ever recovered, if it is lucky, it can be recovered, if not, it cannot be said. It seems to me that lost bitcoins can never be recovered because it's not like I'm leaving it somewhere and maybe I'll find it if I look for it. Bitcoin is a completely different system so I think if it is lost it can't be found again. If Bitcoin is transferred to someone's wallet by mistake, then it cannot be recovered.

But you are right that if the coins are sent to a useless address it is never recovered it is completely destroyed. Many coins have been lost in this way that can never be recovered or come back.

[nelson4lov]

The popular phase — "Not your keys, not your crypto" can be rephrase to mean "Your crypto, your responsibility". So if you lose it, it's not the chain's fault.

It is true if you say "It's not your keys, it's not your bitcoins" but it can turn to be untrue if you say "It's not your keys, it's not your crypto".

Because altcoins with smart contracts can help governments, developers to seize your altcoins, tokens in your own non custodial open source wallets too. They can use smart contracts for doing this. So with altcoins, if you have private keys, mnemonic seeds, it does not mean you own altcoins.

About this, I wasn't talking about altcoins but still, I disagree because not all altcoins can be seized. For instance, when ETH was stolen during the DAO hack, they forked the chain because then it was so early and as such, very few moving parts. Now, no longer likely or almost impossible to do same. The altcoins that can easily be seized due to ownership being retained by the deployer of the token contracts are mostly stablecoin projects. If ownership is renounced and no owner privileges to action or ban token holders, then it should be good to go.

It exists, but not all. That's something to keep in mind.

[tbct_mt2]

About this, I wasn't talking about altcoins but still, I disagree because not all altcoins can be seized. For instance, when ETH was stolen during the DAO hack, they forked the chain because then it was so early and as such, very few moving parts. Now, no longer likely or almost impossible to do same. The altcoins that can easily be seized due to ownership being retained by the deployer of the token contracts are mostly stablecoin projects. If ownership is renounced and no owner privileges to action or ban token holders, then it should be good to go.

It exists, but not all. That's something to keep in mind.

I don't say all altcoin wallets will be seized but the risk of misuse of smart contract is there. It does not mean anything helpful for you and your fund if you belong to a minority of cryptocurrency holders with seized funds even in your wallets.

See the existing risk from smart contracts and be more careful with altcoins. Smart contracts have mint function that allows scam developers to mint massive new tokens and dump token price. Generally you can see many risks converged with altcoins, so let's aware about these risks first, and make your decisions carefully to invest money in Bitcoin or altcoins.

Your example about ETH fork after The DAO Hack, is not related to a risk from smart contract and fund freeze mentioned in my post.

[acroman08]

it will be 21 million minus the bitcoins lost in wallets, which according to studies, is almost 4 million lost coins. This value will probably increase significantly as the year goes on.

and along it so is the price of Bitcoin since as more Bitcoin is lost there will be less Bitcoin in circulation which will make it more scarce in the process(or at least that is what is supposed to happen)

What could happen to these lost bitcoins? Will they continue to be lost in "limbo"

yeah, that's basically it. no one has access to them so they cannot be spent.

[BlackHatCoiner]

I disagree because not all altcoins can be seized. For instance, when ETH was stolen during the DAO hack, they forked the chain because then it was so early and as such, very few moving parts.

"Not all altcoins can be seized", and in the next breath, you give Ethereum as an example? Of course not all altcoins can be seized (e.g., Monero), but Ethereum is the perfect example of pro-censorship altcoin. It happened in the past, and it can happen in the future; in fact, it's easier to redo it with Proof-of-Stake.

[nelson4lov]

I disagree because not all altcoins can be seized. For instance, when ETH was stolen during the DAO hack, they forked the chain because then it was so early and as such, very few moving parts.

"Not all altcoins can be seized", and in the next breath, you give Ethereum as an example? Of course not all altcoins can be seized (e.g., Monero), but Ethereum is the perfect example of pro-censorship altcoin. It happened in the past, and it can happen in the future; in fact, it's easier to redo it with Proof-of-Stake.

If it has been done lately, why haven't the ETH in wallets that scammed or hacked from other users been seized?  The only seizure in recent years has been largely on CEX and not on people's personal wallets itself. ETH is a $300B asset. Do you think they care about individual user balances enough to fork the network to get it back? The altcoins I was referring to in my earlier post was token contracts that have an explicit ban and ban list as methods/functions of their token contracts.

If there's been a recent case of this on ETH, do well point me in the  right direction.

[john_egbert]

When something is lost, it means you can not have access to it again, unless you luckily find what can grant you access to what you have lost. The possibility of losing your Bitcoin is if you no longer have access to your private key and it was an act that was very common years back, probably because Bitcoiners of that time didn't know that Bitcoin will become very appreciative to what it is today.

When something is lost, in some cases there are always chances of getting it back if there is careful retracing. The same is applicable to bitcoin.
 
Someone can lose access to their holdings today and still regain access to them again in times to come. Only those coins that are sent to the burn address are what I consider to be what's lost forever.

Yep. But usually "lost" coins are the ones that have no way of seeing them again, the seeds are gone or the info to gain access to the wallet is gone, etc..

[Emikoyumi]

Hello friends, this is my first discussion on the forum, and it's a pleasure to be part of this environment

I've always had a big question about the bitcoins in wallets that were lost over time. Of course, this is not something to worry about right now, but when will the limit of bitcoins be mined be reached? The circulation limit of the asset will not be just 21 million (value estimated by the system), it will be 21 million minus the bitcoins lost in wallets, which according to studies, is almost 4 million lost coins. This value will probably increase significantly as the year goes on.

What could happen to these lost bitcoins? Will they continue to be lost in "limbo"

Yes i think this topic of lost bitcoins is quite interesting and closely tied to the fundamentals of bitcoin. The total supply of bitcoin is fixed at 21 million doller. And  this will never change. However bitcoins that are lost due to inaccessible wallets or forgotten seed phrases are effectively removed from circulation forever. Research estimates that around 4 million bitcoins are already lost. and this number is likely to increase over time.This means the actual circulating supply is less than 21 million doller  which strengthens bitcoin scarcity and value proposition. Lost bitcoins cannot be recovered or recirculated by any centralized authority they remain permanently locked on the blockchain. This ensures the decentralized and predictable nature of bitcoin remains intaction. i think in the long term, the loss of bitcoins increases scarcity which could influence price if demand remains steady or grows. Simply put what is lost is lost forever, and this is an integral part of bitcoin’s design and scarcity model.

[john_egbert]

They are lost to a good cause, basically.

I wouldn't really put it in this way, despite the fact that as Satoshi said: they make everyone's coins worth slightly more. However, you cannot call it a good cause when people lose their private keys or seed phrase and cannot recover their funds, or when people lose their hard drive, like James Howells did, and can no longer recover their coins, it is sad for the victims and unfair on them to call it a 'good cause'.

For others - it is.

For those people who truly lost their BTCs forever - of course, that's bad, and anything would change that..

[BitHodlers]

They are lost to a good cause, basically.

I wouldn't really put it in this way, despite the fact that as Satoshi said: they make everyone's coins worth slightly more. However, you cannot call it a good cause when people lose their private keys or seed phrase and cannot recover their funds, or when people lose their hard drive, like James Howells did, and can no longer recover their coins, it is sad for the victims and unfair on them to call it a 'good cause'.

Nothing is sad about it, it is a consequence of your own actions. Don't want consequences? Then be more responsible in your behavior. Anyhow, it is the utilitarian view that this is a good cause. So many people benefit from one person's mistakes or stupidity. Thereby the benefits definitely outweigh the negatives.

For others - it is.

For those people who truly lost their BTCs forever - of course, that's bad, and anything would change that..

Many of the losses are not sad, they are just hindsight bias situations. What is worse, losing the coin or spending it on something useless in the early days? For me it is not much different. The people that have managed to keep their coin secure all this time are the ones that probably deserve it as they spent sufficient time into ensuring this safety.

[SilentEcho]

Lost bitcoins are considered permanently inaccessible because no one can recover the private keys once they are lost. So yes, the maximum supply of Bitcoin will still be 21 million, but in practice the circulating supply will be lower due to these lost coins. This scarcity could actually increase the value of the remaining bitcoins over time. In short, the lost bitcoins will remain in the blockchain forever but out of circulation, like they are “frozen.”

[Stable090]

What could happen to these lost bitcoins? Will they continue to be lost in "limbo"

If your bitcoin is lost, then it’s going to be lost forever, there is nothing you can do about it, that’s why when you investing in bitcoin, then you shouldn’t joke with your wallet security, make sure you choose the appropriate wallet to use, and make sure you properly secure your seed phrase, because if you lose your seed phrase, then the bitcoin in your wallet is also gone, so when securing your seed make sure it’s not stored online, your seed phrase should be store offline.

If you are storing your seed phrase also, make sure it’s stored in a place were your family members can easily access it Incase if anything happens to you, because it won’t make sense that your family members won’t be able to access your bitcoin Incase if anything happens to you, the bitcoin will just be in your wallet, and your family might really need some money, but they won’t even know you having bitcoin, or they won’t be able to access it.

[ContentWriter]

Bitcoin that is lost and cannot be recovered by the owners for some reason, will be as charity to the bitcoin community, and that will add to the value of bitcoin, because it will limit the quantity of bitcoin within the reach of people. This is why you need to backup your seed phrase in three locations far from each other to avoid a total lost, because you will not have access to your wallet anymore, and your bitcoin will be locked forever in the blockchain.

I found this interesting. In fact, it got me thinking. When your coins are backed up and your seed phrase or private keys are placed in three locations, don't you think the possibility of some unauthorized person getting hold of the private key increases? I don't know who else does this, but unlike placing your coins' private key in a safe deposit or something similar, placing them in three different places could make them fall into the wrong hands, don't you think so?