Topic: Bitcoin Extinction (Read 978 times)

Very helpful, as usual DannyHamilton...thanks much.  Will be interesting to see how this plays out in practicum.

every lost bitcoin is a donation to the other bitcoin holders
if one day we have one remaining bitcoin and the rest are lost, we can still use it
just move the decimal place another x places to the right and we have enough units for global usage

Thanks.  Occasionally I try to include a bit of humor while educating others.


Keep in mind though that this isn't necessarily "lost".  There's a very good chance that the private key for that address is still stored somewhere, and that those bitcoins could re-enter the economy.

Found Hamiltons post funny 

Ok so it will come to a point where people will be able to make estimates on how much Bitcoin is lost every year, once adoption rates slows down and stabilizes tt will be interesting to see if the rate of lost Bitcoin will be more or less than standard fiat. Bitcoin might eventually be more secure than fiat, especially since multi-sig and all. But I've read quite a few members on reddit simply sending Bitcoin to the wrong address, one person recently sent Bitcoin to the recently defunct M.t Gox. So the issues is not quite the limited supply of Bitcoin, this is a good attribute, the issues is it's useability. Im confident that issues regarding useability will improve with time though.

There really won't be a Bitcoin extinction due to the fact that so many are mined per day. If you take the amount of BTC mined per day, as stated above, in the 3,000s, that wouldn't equate to the BTC that is lost. Hell, it wouldn't be any where near. At the cap of the market or BTC in circulation, the BTC lost somewhere won't even matter.

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.

Congratulations!  You are the 1,000th Jr. member to post exactly this same concern!

(learn to search)

I believe this won't be a problem. At least not for a -very- long time. The first reports of coins lost were when they were worthless. You couldn't have "given" those coins away, people weren't even willing to download the chain at that point... Now, that they have decent worth, lost coins (if any) will be very, very small amounts. Technologies and systems are making it easier and easier to store wallets and create backups. Especially in the bitcoin community, security is kind of a big deal. It wasn't so much then. Sure, we can skim a few hundred thousand bitcoins from extremely old wallets out of the market. It won't bother any active wallets today or wallets in the future...

OP talks about lost bitcoins..

1) for many years more bitcoins are produced then lost. (right now 3600 a day are made)
2) the percentage of lost coins is less then 1%
3) in 120 years when coins are no longer produced there will still be many millions in circulation

This won't need to be addressed for a very long time but maybe a POS could be added to keep the supply around 21 million.

Need somebody to buy that landfill off the city and truly "mine" for BTC.

Bitcoin is nothing if not resilient.  But something has been niggling at me for some time now...one lingering question that while seemingly far-fetched in these early adoption phases clouded by more pressing growing pains, could prove problematic years down the road.  

Bitcoin and its visionary community have absorbed every single hurdle...granted, with varying degrees of success, but at the end of the day, BTC always seems to emerge stronger.  The only thing that would seem capable of stopping this paradigm shifting freight train...is if Bitcoin were to go extinct...

If the ecosystem's physics are to be believed, then as we all know only 21 million BTC will ever exist.  But wait...we already know that a full predetermined allocation of 21 million BTC never will exist, since many BTC have already been lost forever.  Example A--the now infamous story of 7500 BTC lost to a landfill last year:  http://www.cnet.com/news/uk-man-tries-to-retrieve-7-5-million-in-bitcoins-from-dump/  [Sidebar: isn't it astonishing how news from just a few months ago, feels like tales from a bygone era in the lighting fast evolution process that is Bitcoin?]  There are countless unknown other such BTC vanishing acts occurring around the globe...likely on a consistent basis...such is the nature of assets of any sort--but in this particular case, we can't just create more (without cracking the encryption anyway).

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...?