theoretically there are 21 mil btcs, in reality, many bitcoins are lost

[Ron~Popeil]

This might be an issue in the distant future. If current life expectancy doesn't improve dramatically none of us will be here to worry about it. If it becomes a big enough issue the developers at that time can add a minimal amount of block reward coins back in to keep a stable supply. 

[franky1]

This might be an issue in the distant future. If current life expectancy doesn't improve dramatically none of us will be here to worry about it. If it becomes a big enough issue the developers at that time can add a minimal amount of block reward coins back in to keep a stable supply.  

by simply adding another million to the circulation is inflationary..
no thanks..

i would rather have it that in a few decades time once it starts nearing the 20th million boarder of bitcoins mined, that people realise that there are only 19mill in active circulation, thus the fight for hoarding coins gets that much stronger. and people realise that 1-5% cant be accessed.

it will teach people to be more careful and increase the rarity factor. adding excess coins would ruin the scarcity factor and ruin the whole trust that bitcoin cant be tinkered with. after all if they add 1mill extra in a few years, whats to stop them keep adding extra's later

now i will meander over to gold.

you realise that old tech (defunked computers) end up in landfill, making precios metals like gold become 'out of circulation' the amount of sunked pirate ships over the centuries with chsts of gold coins, lay at bottoms of the oceans, out of circulation.. lets not suddenly start making gold using bacterial waste to counter gold stocks.

keep bitcoin rare, keep it away from inflation

[Cicero2.0]

This might be an issue in the distant future. If current life expectancy doesn't improve dramatically none of us will be here to worry about it. If it becomes a big enough issue the developers at that time can add a minimal amount of block reward coins back in to keep a stable supply.  

by simply adding another million to the circulation is inflationary..
no thanks..

i would rather have it that in a few decades time once it starts nearing the 20th million boarder of bitcoins mined, that people realise that there are only 19mill in active circulation, thus the fight for hoarding coins gets that much stronger. and people realise that 1-5% cant be accessed.

it will teach people to be more careful and increase the rarity factor. adding excess coins would ruin the scarcity factor and ruin the whole trust that bitcoin cant be tinkered with. after all if they add 1mill extra in a few years, whats to stop them keep adding extra's later

now i will meander over to gold.

you realise that old tech (defunked computers) end up in landfill, making precios metals like gold become 'out of circulation' the amount of sunked pirate ships over the centuries with chsts of gold coins, lay at bottoms of the oceans, out of circulation.. lets not suddenly start making gold using bacterial waste to counter gold stocks.

keep bitcoin rare, keep it away from inflation

I completely agree in principal. With divisibility the supply is much larger than the 21 million obviously. I was just exploring the what if scenario. It is a habit I have that annoys my wife at times as well.

[FUR11]

It's safe to assume that from now and into the future the number of lost Bitcoins will not increase very much, because in the past people didn't think much of Bitcoins and formatted drives without thinking twice.

I agree with this very much. LOL

Yeah, it is true, people who buy BTC with their hard earned money nowadays know about the real world price of them so they just don't lose track of them. But it'll happen today and even tomorrow, since there'll always be people who just don't pay attention and format their hard-drive, don't have backups, lose their phones, etc...
BTC will always be lost! Imagine having the only remaining BTC while all the others are lost!

[DjPxH]

It's safe to assume that from now and into the future the number of lost Bitcoins will not increase very much, because in the past people didn't think much of Bitcoins and formatted drives without thinking twice.

I agree with this very much. LOL

Yeah, it is true, people who buy BTC with their hard earned money nowadays know about the real world price of them so they just don't lose track of them. But it'll happen today and even tomorrow, since there'll always be people who just don't pay attention and format their hard-drive, don't have backups, lose their phones, etc...
BTC will always be lost! Imagine having the only remaining BTC while all the others are lost!

True! It'll get less, that's for sure. At least as long as bitcoin continues to gain value! But coins are bound to get lost by definition. Once really lost, they can't effectively be recovered. This is bound to happen at some point and in some quantities.

[ljudotina]

No need to put decimals on satoshi (if it ever happens that 1 satoshi is 1$). You have Namecoins and other coins that have far less value than Bitcoin which can serve that purpouse. Some of them are mined together already so security of network is same. Basicly, price would be: 1.99 which would be 1 satoshi and 99 namecoins or something similar.
There are enough altcoins that are tied to Bitcoin that can release pressure.

[Sumerian]

And don't forget the satoshi's being left like garbage by ppl who don't care. That's still happening everyday

[ducatitalia]

Oh boy, it's this discussion again. This point holds for any limited resource.

I think that either DannyHamilton or DeathAndTaxes gave a pretty reasonable explanation into this whole economic edge to the limited supply dwindling, though there's no way that I'm likely to find it.

Good explanation from DannyHamilton responding to this thread: https://bitcointalk.org/index.php?topic=647618.0

So to the point...how does a capped financial system, which at some point will only be able to diminish in total quantity (and will do so continuously) manage to escape eventual extinction (regardless of divisibility), or at the very least dramatically reduced availability to the point of compromising the very economies it creates...?

Regardless of divisibility?

What do you mean by "regardless of divisibility"?

Divisibility is exactly the reason that this isn't a concern.

As bitcoins are lost, the available supply is reduced.  Economic effects result in the remaining bitcoins being worth more.  This means that instead of spending 10 mBTC for a sandwich, you are eventually spending 10 µBTC (see how divisibility makes that possible?).  As a result, the remaining bitcoins are spread thinner.  This means that each individual with the same wealth has less bitcoins than they would have had in the past.

If any of these individuals lose their bitcoins, the supply is diminished, and the value of the remaining bitcoins increases.  Eventually (a few centuries from now) instead of spending 10 µBTC for a sandwich, you'll be spending 10 nBTC.  As a result, the remaining bitcoins are spread thinner.  This means that each individual with the same wealth has less bitcoins than they would have had in the past.

If any of these individuals lose their bitcoins, the supply is diminished, and the value of the remaining bitcoins increases.  Eventually (a few millennia from now) instead of spending 10 nBTC for a sandwich, you'll be spending 10 pBTC.  As a result, the remaining bitcoins are spread thinner.  This means that each individual with the same wealth has less bitcoins than they would have had in the past.

And so on, and so on.

Eventually there is only 1 pBTC (0.000000000001 BTC) remaining in existence.  But because of divisibility, it is broken into 1,000,000,000,000 yBTC pieces spread throughout the economy.

This process can repeat as many times as you like.