Topic: Can bitcoins be lost out of existence? - page 2. (Read 1148 times)

Good point Jace

Just nitpicking about symantics: bitcoins don't exist in the first place, there's only a list of transactions between addresses. This history of transactions is never lost. But sure, coins can become unavailable (effectively "lost") if people lose their private keys.

This is never gonna happen. It will come arbitrarily close, but the actual 21 million will never be reached.

Way, way before year 2140 (or thereabout) when the block reward halves down to less than 1 satoshi, the smallest subdivision of 1 BTC will be reduced to less than the 1/100,000,000th that current clients support (probably to unlimited pricision, by simply allowing floating point BTC values of arbitrary length).

So no matter how many coins are destroyed, new fractions are always being mined, even in hundreds or thousands of years from now.

Assuming coin loss is slow the system can be adjusted .   The current 8dp limit is arbitrary and can be changed with the consent of the majority of the hashing power(they all agree to update their software to allow 16dp say).
             

If real money is lost or damaged, somebody eventually finds it, or more can be printed in its place. If bitcoins are lost, new ones can be mined. But this will one day not be possible anymore. As for expanding the limit, it's a slippery slope. Nobody can prove they lost their bitcoins, and the network can't tell the difference between bitcoins left for safekeeping for 10, 50, 100 years and bitcoins whose wallet has been permanently lost.

If new coins are generated beyond 21m "to compensate" for the lost ones, how can one possibly gauge the loss? And with losses constantly occurring, this "compensation" cap rise would very well mean that it will be raised indefinetly, allowing for perpetual creation of new BTCs, which breaks one of its own rules brings back the inflation problem.

On the other hand, if we do not generate BTCs beyond the cap, we will slowly move towards owning # gigabytes worth of unreadable hdd-occupying gibberish. When the last wallet containing coins is lost, the entire blockchain - by then probably in the terabytes if not petabytes - will be worth absolutely zero.

I feel like the system needs to make coins orphan-proof, or reminable. In its current state that simply isn't possible since again - it's impossible to tell between money left for safekeeping and money without a wallet. If a rule would be made to force all coin blocks to be read at least once a year before being deemed orphan and made reminable, that would solve the problem, and introduce a whole new set of issues in turn. I'm not sure it's even possible for the network to check the birth date of a block once it's encrypted and only the private key can read its content, not to mention nothing of its current structure stores last read timestamps. So in other words, there's no easy fix...

Is that even possible without everybody starting over from scratch?

A grisly thread full of cautionary tales...

https://bitcointalksearch.org/topic/lets-add-up-the-known-lost-bitcoins-7253

If that were to happen, the code would change to expand the limit, and everybody would upgrade.
But only if the whole network agreed...

Yeah, that is already happening. Computer crashes and such. Other forget their coins.

Imagining a hypothetical scenario in the future, where all 21 bitcoins have been generated, and no more are possible. Giving this more time, users, one way or another, will end up making mistakes and losing their wallets from formats or faulty hardware. Since this results in permanent loss of access to those bitcoins, will people gradually and steadily lose more and more access to the blockchain's coins until no more can be retrieved? This is currently not a problem since we can keep generating new coins, but once the limit is reached, I imagine the supply won't be stuck at 21m but will in fact start to go down as these mistakes gradually make coins unavailable.