The misconception of lost Bitcoin.

[Joy- maker]

It has come to my attention that people often believe that millions of Bitcoin are lost forever and somehow weaken Bitcoin, but that is not true. Although in reality, those claims are mostly based on guesswork.

Bitcoins are usually labeled lost just because it has not moved for years, but Bitcoin doesn't actually required movement like fiat currency do. Long term investors or Holders can choose to keep their Bitcoin untouched for years or decades and many intentionally leave their Bitcoin untouched for various reasons.

It is said that Bitcoin is truly lost if the private key is permanently gone, but frankly speaking, there is no way to prove this on the blockchain. Why because forgotten password get recovered, old backups turns up and wallets that were labeled lost back then have resurfaced before.

And even if some Bitcoin are genuinely lost Bitcoin still works exactly as intended. Bitcoin is divisible into 100 million units per coin, so it reduce in Supply only increase scarcity not dysfunction, as some persons claim.

The Bitcoin in Satoshi Nakamoto's  wallet is another big example they have never moved, but nobody can actually tell if are lost or simply untouched. And Bitcoin does not require that question to be answered.

So, do not let lost Bitcoin stories confuse the real story because Bitcoin works exactly as intended. Lost Bitcoin is mostly a misunderstanding of how Bitcoin ownership and Long term holding work.

[Tongley]

Yes, it is true that many Bitcoins are lost. We see many videos, they have lost Bitcoins or we hear many people saying that they have lost Bitcoins. But I don't know how true it is. Especially in the case of a new person, the cases of losing Bitcoins are more common, when they connect to the wallet, they do not consider the Seed Phrase as very valuable. Because of this mistake, they lose their Bitcoins after a while.

When a person loses Bitcoins, it can be good for us. Because when someone loses Bitcoins, there is no hope of getting those Bitcoins back in the market. This amount of Bitcoin crisis will be seen in the market and when the demand for Bitcoin increases, the price will increase a lot more.

[Donk1]

Well, I created a topic about how lost coins benefit other https://bitcointalk.org/index.php?topic=5569861.0 and after some research I like to believe that all Bitcoin are classified as lost coins until they are used. Basically this simply means since many Bitcoin enthusiasts invest their coins for the long term unfortunately since it's not being used it's classified as a lost coin alongside with those folks who have lost their private keys/seed phrase to their wallet.​That said what I like to believe now is that since the Bitcoin network can't tell which and which coins are lost so how do you classify those folks who have actually lost their coins in their wallet? It's best to say that the Blockchain network only sees all coins as unspent it can't tell if the coin is still being used or not. Though I didn't add this to my topic still I believe it would have been very helpful..


​over all though we can't tell which coins are lost but that's based on supply and demand and the fact that Bitcoin is limited its unique scarcity of 21 million coins is the only thing that can differentiate a lost coin form a long holders. Basically because of this scarcity when a coin is lost every other coin is worth more.
Check out this link you will find out a lot.. https://satoshi.nakamotoinstitute.org/quotes/bitcoin-economics/?hl=en-GB

[AuchanX]

When a person loses Bitcoins, it can be good for us. Because when someone loses Bitcoins, there is no hope of getting those Bitcoins back in the market. This amount of Bitcoin crisis will be seen in the market and when the demand for Bitcoin increases, the price will increase a lot more.

It is not entirely correct to look at the issue of Bitcoin loss in a positive Light..Lost Bitcoins reduce the supply in the market.This can put positive pressure on the price in the long run, this argument is correct. However,at the same time, it also creates a risk for the network, because the real owner loses control over his assets forever, so rather than calling it good for us,it can be said that this is an unintended consequence of Bitcoin's deflationary nature.Yes,you are right that most Bitcoins are lost due to user error, especially newbies who do not understand the importance of seed phrases, private keys or wallet backups. This is not actually a technical weakness, but a lack of awareness. Therefore, new users should be given the most importance. Remember one thing, the fewer Bitcoins are lost, the more people will have confidence in Bitcoin technology. And in the long run, this is the most important thing for Bitcoin's acceptance and value growth.

[Hypnotizer]

It has come to my attention that people often believe that millions of Bitcoin are lost forever and somehow weaken Bitcoin, but that is not true. Although in reality, those claims are mostly based on guesswork.

Lost Bitcoin aren’t weaken the network, basically they even help the network because it will reduce the circulating supply thereby increasing the scarcity.

Bitcoins are usually labeled lost just because it has not moved for years, but Bitcoin doesn't actually required movement like fiat currency do. Long term investors or Holders can choose to keep their Bitcoin untouched for years or decades and many intentionally leave their Bitcoin untouched for various reasons.

Lost bitcoin are not labeled lost because they didn’t move for long term, there are bitcoin that are burnt because they are sent to unrecoverable address or maybe the other lost his private keys. Long term kept coins aren’t considered lost, they are basically just unmoved not lost or burnt.

It is said that Bitcoin is truly lost if the private key is permanently gone, but frankly speaking, there is no way to prove this on the blockchain. Why because forgotten password get recovered, old backups turns up and wallets that were labeled lost back then have resurfaced before.

Yeah, it happens that way while as I said above, some Bitcoin are burnt by sending them to unrecoverable address. Seems like you got a misunderstanding yourself about the lost bitcoin.

[Saltysugar99]

Bitcoin is lost when the owner of the wallet that contained the bitcoin has forgotten or lost the seed phrase. This means that he will no longer be able to access that wallet. The bitcoins will be frozen for lifetime. Who has lost them now or who has not moved the bitcoins intentionally for years is just speculation. Many websites publish this as an article where they estimate that 2.3–3.7 million bitcoins have been lost. There are even many websites that say more or less than that. But as you said, the whole thing is speculation.

https://www.hedgewithcrypto.com/how-much-bitcoin-is-lost

[Ishicryptic]

The fact is that even if you lose your Bitcoin when you misplace your private keys, it doesn't erase from the Blockchain, it will still be there and as long as you can't have access to it it is as good as lost forever to you. Bitcoin cannot add to it's 21 million limit or reduce so every lost Bitcoin is still a part of it's total supply, what happens is that all the lost Bitcoin have become a donation to the network. The more Bitcoin that is lost creates more real scarcity to what can be bought, it's not the same scarcity as holders who hodl theirs because they can decide to sell anytime.

What to learn about this discussion is that we should take our wallet security very seriously, your seed phrase is your main keys, even if you lose your wallet device your seed phrase can recover your coins in another device.

[Yablee0]

The fact is that even if you lose your Bitcoin when you misplace your private keys, it doesn't erase from the Blockchain, it will still be there and as long as you can't have access to it it is as good as lost forever to you. Bitcoin cannot add to it's 21 million limit or reduce so every lost Bitcoin is still a part of it's total supply, what happens is that all the lost Bitcoin have become a donation to the network. The more Bitcoin that is lost creates more real scarcity to what can be bought, it's not the same scarcity as holders who hodl theirs because they can decide to sell anytime.

What to learn about this discussion is that we should take our wallet security very seriously, your seed phrase is your main keys, even if you lose your wallet device your seed phrase can recover your coins in another device.

You aren't far from the main fact, what really describe  lost Bitcoin is when we no longer have direct access to it maybe after misplacing our wallet secrets phrase or way about but the main fact remains that the Bitcoin itself will still remains intact in the Blockchain and it will be there for as long as God's know without anything going wrong with it, maybe if you are lucky or  later remember or  recover your password or pass phrase you can still take poccession of it despite the years.

Therefore, on this note i am saying in my opinion that your security capability in protecting your assets from an intruder is what really matters in Bitcoin investment because without you getting access probably through carelessness of misplacement of your secret phrase or maybe been hacked by scammers than you are as good as a no coinner.

[Don Saga]

Firstly,  what gave you the impression that lost bitcoin weakens bitcoin? Because it is actually the other way round as it makes bitcoin scarce which actually increases the price of bitcoin over time. Additionally,  most bitcoins are actually lost and inaccessible without the recovery phrase, the wrong impression comes in when you think there is some kind of private system that runs bitcoin.

[Nathrixxx]

It has come to my attention that people often believe that millions of Bitcoin are lost forever and somehow weaken Bitcoin, but that is not true.

I appreciate the fact that you're able to know that's not true, every lost coin is gone forever and can't be reclaimed, however, the influence on the market are not felt, because they are been distributed to all other coins from our holdings and that is why we see how we all can make profits from holding, because they value increases and the supply reduces by so doing.

[Obim34]

No, they are considered lost until found.

We can't tell what happens to a coin that has stayed in a wallet for a long period without any activity, how do we differentiate lost coins from a wallet that just has not moved any coins for years?

There is hardly any misconception, few investors lose access to their wallets, and fortunately for some, they will recover it, but not all do.

[Silverstonez]

I have once heard of this before that Bitcoin is not totally lost unless the private key is gone.  And Some persons also argued that if Bitcoin remains untouched or has not moved for years or decades that it is considered lost until the Bitcoin is find. But how can we prove this on the blockchain? I don't think it can be proved that a Bitcoin is lost, or if it has been proven before that a Bitcoin is totally Lost and gone.

So for me if it can't be proved on the blockchain that a Bitcoin is lost then,  I don't see any reason to consider Bitcoin that hasn't moved lost, because long term investors can choose to keep their Bitcoin untouched for years or decades making us believe that the Bitcoin is lost.

[Btcdeybodi]

Bitcoins are usually labeled lost just because it has not moved for years, but Bitcoin doesn't actually required movement like fiat currency do. Long term investors or Holders can choose to keep their Bitcoin untouched for years or decades and many intentionally leave their Bitcoin untouched for various reasons.

I argue the part i highlighted because the primary aim of creating bitcoin was as an alternative means of payments in a decentralized way so if not for the idea of investment that came, people would have mostly been using it as everyday money which is same thing that happens with fiat currency.
 
There is no misconception about lost bitcoins, it is real. Some persons have lost access to their private keys and seed phrases which means 'not your key not your coins' so the coins in those wallets are lost forever. While there are people who haven't access their bitcoins even in 10 years but many people have also lost access to their wallets and the amount in those wallets will remain stuck there forever.

[Ambatman]

I think you are looking at this from a wrong angle
Many people are aware that lost coins reduces supply in circulation
Which in turn is expected to push price as a result of scarcity.
The misconception many have is that they are not aware that losing private key isn't the only way coins are lost
It can be lost provably through OP Returns
They become unusable and can never be accessed according to Bitcoin protocol.

[Odohu]

I would have loved to see this topic in the Bitcoin Discussion thread so that we have more experienced people participate in the discussion, a lot of learning would have been achieve from such discussion. The little I know about lost Bitcoin are Bitcoin in wallets that access to them may no longer be possible. There have been cases of people who lost access to the device where they stored their coins, those coins are considered lost. The only part of the lost Bitcoin I don't agree with is the assumption that those coins held in the wallet linked to Satoshi are lost.

[Mia Chloe]

The Bitcoin in Satoshi Nakamoto's  wallet is another big example they have never moved, but nobody can actually tell if are lost or simply untouched. And Bitcoin does not require that question to be answered.

Satoshi actually had numerous wallets with coins in mined back in 2009 - 2010 scattered across them. It's very possible some wallets tagged as those of a whale just might be Satoshi 's. On the Blockchain especially bitcoin dormancy of a wallet doesn't necessarily mean that the keys are lost.

Also take note that the coins in the genesis block is like the foundation of bitcoin UTXOs and necessarily can't be spent because of it's role in the protocol.

[Su-asa]

One thing I actually liked in the op is when you talked about fiat and Bitcoin. For real, Bitcoin is not like fiat currency likewise fiat is not like Bitcoin in anyway. Fiat currency that's sent to a wrong account can be recovered but Bitcoin that's sent to a wrong address can not be recovered.

However, talking about Satoshi Nakamoto's we don't know if he's alive or dead yet but we know about his wallets and probably the balance on it. The fact that we don't know if he's alive we can not assume if the Bitcoin in the wallet is lost or not. He might not be alive but their must be an heir to his crypto assets, let's not be surprised one day there will be a transaction some of his wallets.

[Agbamoni]

It is said that Bitcoin is truly lost if the private key is permanently gone, but frankly speaking, there is no way to prove this on the blockchain. Why because forgotten password get recovered, old backups turns up and wallets that were labeled lost back then have resurfaced before.

What do we call those bitcoins that cannot be recovered at all? I mean Bitcoins in a wallet where the seed phrase and private keys are lost without any single trace to recover them.
Those Bitcoins will stay dormant and unmoved in the wallet forever, right? For me, it can be considered to be lost Bitcoins, since it cannot be accessed. In addition, there are Bitcoins that were sent to the wrong address, those Bitcoins are considered burnt and lost because they cannot be recovered.

[JiiBs]

​

One of the iconic lines, “a donation to everyone else or better still, to the network”

There have being a couple of confirmed lost Bitcoins in recent times like James Howells who discarded his hard drive containing over 8000 Bitcoins. That’s completely lost to him as, all efforts to retrieve it failed and a couple of those suicidal fellows. It’s tragic but, those too add up to the lost coins and make Bitcoin today far more scares and valuable.

The concept of lost Bitcoin and those untouched wallets still goes until proven otherwise.

[dzungmobile]

Well, I created a topic about how lost coins benefit other https://bitcointalk.org/index.php?topic=5569861.0 and after some research I like to believe that all Bitcoin are classified as lost coins until they are used.

We never can know surely about a Bitcoin UTXO is lost forever or still in control of someone. People can simply don't touch their bitcoins in many years, it's not too common practice as most people can not be long term holders with diamond hands. Though it does not mean nobody have that practice of holding very tightly in many years, and our calculations on lost bitcoins are more accurately to say as Estimations with inaccuracy for sure.

With different thresholds of inactive UTXOs, you will have different estimations on lost bitcoins.
https://www.bitcoinmagazinepro.com/charts/hodl-waves/

Let's see the topic of that screenshot.

Lost coins only make everyone else's coins worth slightly more.  Think of it as a donation to everyone.