Talking about "free" bitcoins. What happens with bitcoins that have been earned but the wallet is deleted afterwards? The bitcoins stay in the blockchain but nobody can access them anymore because the keys are gone?
I wonder how much capital is floating in the chain without real owners?
They are lost, but that's not a problem, because all other Bitcoins are worth more then and they are dividable.
My guess is about 1 mio is lost already, but nobody knows for sure.
Perhaps there could be some way for clients to periodically verify ownership of the transactions associated with their key, if there's no verification for a significant period (several years?) the funds get released back into the potential mining pool. I don't know how difficult this would be to code.
It's going to become a real issue at some point in the future, where minting new coins is near impractical. The rate of permanent loss will exceed generation.
Defenitely no, paper wallets cannot prove ownership.
Also it's not going to be a problem, the only thing that will happen is that you trade in smaller Bitcoin units, if too much coins are lost.
