Topic: [DISCUSSION] What will happen to the "lost" bitcoins? (Read 628 times)

https://bitcointalksearch.org/topic/--5514107

If it has been done lately, why haven't the ETH in wallets that scammed or hacked from other users been seized?  The only seizure in recent years has been largely on CEX and not on people's personal wallets itself. ETH is a $300B asset. Do you think they care about individual user balances enough to fork the network to get it back? The altcoins I was referring to in my earlier post was token contracts that have an explicit ban and ban list as methods/functions of their token contracts.

If there's been a recent case of this on ETH, do well point me in the  right direction.

"Not all altcoins can be seized", and in the next breath, you give Ethereum as an example? Of course not all altcoins can be seized (e.g., Monero), but Ethereum is the perfect example of pro-censorship altcoin. It happened in the past, and it can happen in the future; in fact, it's easier to redo it with Proof-of-Stake.

and along it so is the price of Bitcoin since as more Bitcoin is lost there will be less Bitcoin in circulation which will make it more scarce in the process(or at least that is what is supposed to happen)

yeah, that's basically it. no one has access to them so they cannot be spent.

I don't say all altcoin wallets will be seized but the risk of misuse of smart contract is there. It does not mean anything helpful for you and your fund if you belong to a minority of cryptocurrency holders with seized funds even in your wallets.

See the existing risk from smart contracts and be more careful with altcoins. Smart contracts have mint function that allows scam developers to mint massive new tokens and dump token price. Generally you can see many risks converged with altcoins, so let's aware about these risks first, and make your decisions carefully to invest money in Bitcoin or altcoins.

Your example about ETH fork after The DAO Hack, is not related to a risk from smart contract and fund freeze mentioned in my post.

About this, I wasn't talking about altcoins but still, I disagree because not all altcoins can be seized. For instance, when ETH was stolen during the DAO hack, they forked the chain because then it was so early and as such, very few moving parts. Now, no longer likely or almost impossible to do same. The altcoins that can easily be seized due to ownership being retained by the deployer of the token contracts are mostly stablecoin projects. If ownership is renounced and no owner privileges to action or ban token holders, then it should be good to go.

It exists, but not all. That's something to keep in mind.

If the lost thing is ever recovered, if it is lucky, it can be recovered, if not, it cannot be said. It seems to me that lost bitcoins can never be recovered because it's not like I'm leaving it somewhere and maybe I'll find it if I look for it. Bitcoin is a completely different system so I think if it is lost it can't be found again. If Bitcoin is transferred to someone's wallet by mistake, then it cannot be recovered.

But you are right that if the coins are sent to a useless address it is never recovered it is completely destroyed. Many coins have been lost in this way that can never be recovered or come back.

When something is lost, in some cases there are always chances of getting it back if there is careful retracing. The same is applicable to bitcoin.
 
Someone can lose access to their holdings today and still regain access to them again in times to come. Only those coins that are sent to the burn address are what I consider to be what's lost forever.

There are no "studies". There are less than 5 thousand bitcoin provably lost; the rest are just bareless speculation. 4 million is extraordinary, even with bareless speculation. Where did you find that number?

If you refer to non-provably lost (AKA, speculation), then either their owners will find access, or they will remain lost for a very long time. Those with public keys exposed can be brought into circulation when ECDLP can be solved within a reasonable time by quantum computers.

I don't see the problem with coins being lost, though. The quantity of money does not matter. Even with just a thousand bitcoin in circulation, it can still be traded and used as money.

It is true if you say "It's not your keys, it's not your bitcoins" but it can turn to be untrue if you say "It's not your keys, it's not your crypto".

Because altcoins with smart contracts can help governments, developers to seize your altcoins, tokens in your own non custodial open source wallets too. They can use smart contracts for doing this. So with altcoins, if you have private keys, mnemonic seeds, it does not mean you own altcoins.

https://chainsec.io/nyknyc/
Bitcoin Q&A: Not your Keys, Not your Coins
PSA: Most Stablecoins Can Be Frozen, Even in Your Own Wallets

Those coins are lost. As the term says, unless the owners of those Bitcoins manages to find the keys to their wallet and retrieve those coins, then it's gone forever. Bitcoin isn't just some small network that can be forked off to retrieve all lost coins. If anything, those lost coins reduces the supply which most economists will agree that is good for the tokenomics and demand.

The popular phase — "Not your keys, not your crypto" can be rephrase to me "Your crypto, your responsibility". So if you lose it, it's not the chain's fault.

I don’t think anything will happen to lost bitcoin, as long as your bitcoin is lost, then it’s going to be lost, and I don’t think there is any means by which lost bitcoin can be recovered. That’s why we are supposed to properly secure our bitcoin, we should make sure we make use of the right wallet to store our bitcoin, and we should properly secure our wallet private key.
 
There are some scammers that do claim they can recover lost bitcoin. If you lose your bitcoin, it’s better you just move on, but don’t even try to pay anyone to recover your lost bitcoin for you because they are just going to scam you, and your loss will be more. There is nothing like a bitcoin recovery service after losing your bitcoin.

This is a FAQ
https://en.bitcoin.it/wiki/Help:FAQ#But_if_no_more_coins_are_generated,_what_happens_when_Bitcoins_are_lost?_Won't_that_be_a_problem?

I wouldn't really put it in this way, despite the fact that as Satoshi said: they make everyone's coins worth slightly more. However, you cannot call it a good cause when people lose their private keys or seed phrase and cannot recover their funds, or when people lose their hard drive, like James Howells did, and can no longer recover their coins, it is sad for the victims and unfair on them to call it a 'good cause'.

A PKH address is a ripe160 hash of a sha256 hash of a pubkey, with a one-byte prefix and a 4-byte checksum suffix  
But the prefix and the checksum are not stored in the TXO. Only the 20-byte RIPE hash is stored


Correction. An OP_RETURN TXO does not have an address, so it's not "sent to a burn address"

The short answer is... nothing will happen to the lost Bitcoins. They will remain untouched unless someone finds the wallets and restores the forgotten passwords/seed phrases. Just like Satoshi once said "all lost Bitcoins are a donation to the community", which means that lost BTC make Bitcoin more scarce and increase it's value. If we add quantum computing to the equation, things become a little bit different. Maybe someone could use quantum computers to brute force the passwords and seed phrases of all BTC wallets. This would make Bitcoin worthless, but I'm sure that the BTC developers will find a way to make Bitcoin quantum resistant.

They are lost to a good cause, basically.
I wonder what if d5000's concept would come to life eventually, never heard or dug into some quantum and how they would be able to make something impossible - possible, but it's sure a ride to be interesting.

That's actually true, lost coin can not be recovered but it add value to the market. Because one good quality of anything is scarcity, for anything to have value It must be relatively scarce. this was a quote from Satoshi Nakamoto about lost coin.

This implies that the more bitcoin lost the more it becomes more scarce and also more expensive.

they're gone forever but it also adds sense of scarcity towards the circulating BTC which is still a win for any bitcoin holders at the end of the day.

I think you don't need to worry about it, even if the lost BTC increases in number, market will compensate, BTC is deflationary currency, the value will always go up since total supply is hard capped, i'd say the longer you hold your bitcoin, the more scarce and rare it becomes, it's like holding treasure if i'm being honest.

this thing also what motivates some people into hoarding BTC, because it's just that good for investment.

This is indeed a possibility for those old miner coins nobody is spending (many of them are supposed to be Satoshi's) - think of quantum computers able to break ECDSA. The P2PK transactions could be "cracked" in theory.

Just recently there was a discussion about the economic consequences of this scenario -- let's say quantum computers (or any other future computing technology) gets strong enough to break the keys because P2PK transactions expose the public keys, and Shor's algorithm could in theory calculate the private key taking the public key.

Once this becomes a possibility, opcodes for post quantum cryptography could be added and users be heavily recommended to transact their Bitcoins. And those who do not, have used P2PK and have re-used their address, would be vulnerable to this attack.

Altcoins have often already performed similar swaps, so it's no nuclear science. The only problem is that if there's much onchain activity and the change comes too late, then there could be a huge fee spike, so it would make sense to add post-quantum cryptography challenges relatively early.

And once these "presumed lost coins" which don't participate in this "swap" (not the "provably lost coins" like those burnt in OP_RETURN transactions!) are attacked, then they would be redistributed by the hackers (I don't believe they'll try to HODL).

Maybe even today with BitVM you could already create a post-quantum challenge? This would actually an interesting idea (Edit: I opened a thread about this for those interested).

The "quantum computer attack" is however a very remote possibility and also has been discussed several times here.

If you have the seed phrase to your funds backed up, then there is no question of it being a lost coin in the first place, because the seed phrase for its recovery is available.
Lost coins are not recycled or anything like that, when Satoshi said we should think of it as a donation, he simply meant that lost coins will reduce the supply of BTC available in the market and with demand, that should make available coins worth slightly more.

Yeah, thanks. So, all are estimation for the year but likely to hit exactly and for this quantity of Bitcoin.

You this too early? I cannot believe those stories, but it doesn't mean they're not real. Well, I've read the same experiences about those who have known Bitcoin too early, mined a lot, and then just forgotten the wallet.dat. Same same stories.

But it does happen, I guess a regretful part is waking you up almost every day.

Sadly , I've added more lost coins than I'd care to admit. I heard about Bitcoin in 2010 and decided to start mining while at work . Did so for about 3 years till I moved and got about it . Never found the wallet.dat files 6 years later when I went looking. The bitcoin core wallet showed 2,100 encrypted files ( not sure if that is transactions or what) if transactions there's no telling how many coins as my PC would have been clearing 3-4 BTC solo mining in a day

Already question like this one have been asked on several occasions on this forum, that all the lost coins will be recircled back to the network in form of spreads on every holder of bitcoin, this effect is what is being felt when you're holding and you discover that the market is rising and you're profitable by just holding it without trading, this is just on a single approach, there are other things we may also consider, because no one is there claiming all those lost coins except when being hacked or scammed.

What do you mean by "registered number"?
The 4 millions which was mentioned by OP was just an estimation and he/she didn't even mention any source for that. There is no way to know how many bitcoins have been lost due to the people losing access to the private keys.

They will be lost in Limbo nice word BTW, they will be considered burned which means they're being lost is good for the demand and supply ratio of the BTC and its hype. You are right more people will still be losing their BTC and some are trying hard to find their lost BTC and even some are suing other companies to allow them to search the scrapyard. If we measure in terms of ratio that either people have lost more than the people have recovered then the ratio is high.

Nothing will happen to them they just sit in their addresses and the seed phrases and they will sit there till end they won't expire. 4 millions is just a registered number the actual numbers will be more than this surely.

Lost coins are lost forever. Which means once access is lost, it will clearly be regarded as irreversible. Not your keys, not your coins, so if you have forgotten or lost your private keys, that coins will probably be one's ownership already.

However, in cases where the device where the private keys is kept becomes damaged or ruined, but there's back-up available, then those lost coins will never be lost forever, but will be retrieved anytime.

Another example being if some desparate person had half of his seed phrase burned and posts a picture of the other half online in the hopes that someone can find it.

I think you misunderstood NotATether.
NotATether means that it may possible to get access to lost coins, if there are some information about the lost private keys or seed phrases.

Let's say you have a 12 word seed phrase. You know 7 words with their correct positions and you have lost 5 words. Now, you can't access your coins, but it may be possible that you brute-force the seed phrase one day.

Don't see it happening, though, so they may be marked as lost to the cause of BTC being more scarce in the long run.
Even if we speculate - how a person not associated with them would be able to find the keys?

And also, among other things, happened when the various wallet websites and exchanges shut down, taking many people's assets with them.

Like Mt.Gox, BTC-e, or all of those blockchain.info wallets that were obsoleted by their new trading system.



Only if said lost coins have had some shred of their private key or seed phrase exposed, or any other fragment that would allow signing a spending transaction from it.

To be more accurate:
The exact number of bitcoins (including the lost ones) will be 20999999.9769

Satoshi never said that the lost bitcoins will help the growth of technology. Satoshi said that "Lost coins only make everyone else's coins worth slightly more." and that means that it makes the price grow, not the technology.

When something is lost, it means you can not have access to it again, unless you luckily find what can grant you access to what you have lost. The possibility of losing your Bitcoin is if you no longer have access to your private key and it was an act that was very common years back, probably because Bitcoiners of that time didn't know that Bitcoin will become very appreciative to what it is today.

So, nobody can have access to their lost Bitcoin. Satoshi once said that lost Bitcoin should be considered a donation for the growth of the technology.

Around 2140, based on estimations.

Nope, including the lost Bitcoins they will be all 21 million. So, if there was 4 million bitcoins lost forever then plus 17 million supply, in total of 21 million bitcoins will be mined until that year when it will be lastly mined.

Just to give a note, according to coinmarketcap: we have 19,775,137 BTC in circulation already. And with all of the lost bitcoins, if they're totally lost then they're gone forever unless someone is just fooling around trying to pretend they've lost it and then will access it later on.

This is the price of decentralization, if you lose your private keys, there's no centralized office to help you to recover them, meaning that your BTC is lost forever. It will become a donation to the Bitcoin network and there's nothing you can do about it. I've given my own donation to the network due to my negligence as a newbie then, and I don't hope to donate again, I'm not that charitable  . Being a sole custodian of your coins is a huge responsibility because your private keys are the only access that you have to the coins.

There are more coins provably lost.
As I said in my previous post, some coins were lost due to miners not claiming the block reward and some were lost due to the coinbase transactions having the same hashes.

It depends what you mean by "lost coins". Usually people confuse coins that haven't moved for a long time with lost coins. If it is the former, they are not lost and what happens is that they eventually move! If it is the later then Satoshi already answered your question:
Feel free to read the rest of that topic as well.

Basically coins that are lost are:
1. Coins sent to a provably unspendable output
This includes the OP_RETURN outputs, broken outputs (eg. OP_HASH160 OP_EQUALVERIFY OP_CHECKSIG) and burn addresses. These are lost forever and it is impossible to spend them.

2. Coins in a wallet/address with lost key
This could be a paper wallet that was lost, a digital wallet (eg. wallet.dat file) that was lost due to hardware damage, encryption password that was forgotten, etc. These are lost forever unless the user remembers their password, finds their paper wallet, etc.

Lost Bitcoin stays lost unless recovered, so technically, the total supply remains 21 million. But with lost Bitcoin, the actual accessible supply decreases, which could have a positive effect on the market. Basic rule: when demand is high and supply is limited, prices go up. Over time, as more Bitcoin is lost, its value could keep rising. However, we don’t want this happening, as it’s not ideal for the ecosystem. Let’s just hope more Bitcoin holders learn how to secure their assets.

You don't need to worry about these lost bitcoins if 1 bitcoin is 100,000,000 satoshis or less than 2.1 quadrillion . Also, unlike the bitcoins that are sent to proof-of-burn addresses, we cannot be sure that these bitcoins are lost,

Many reasons for losing bitcoins: in your non custodial wallets by did not have wallet backups, lost your wallet backups; or in accounts on centralized platforms that can be hacked, bankrupted like Mt.Gox or scam exchanges.

Given enough time, lost coins will be reclaimed by technology that is able to claim them.  Of course when the time comes non-lost coins will not be vulnerable to the same technology that claims lost coins.

Yes
Neither the owner nor anyone else will have access to the coins
Well atleast it's not with someone else

It's true that OP-return outputs are lost and can never be spent, but they are not the only coins that have provably been lost.
There were coins that were lost because miners didn't claim them when mining blocks and there were also coins that were lost due to the coinbase transactions having the same hashes.

I don’t even consider bitcoin been lost if they are actually still on a spendable address, many people consider bitcoin sent to a wrong adress as a lost coin, although it is not common but I believe if bitcoin is sent to an address that is with a correct checksum that particular bitcoin isn’t lost because there is tendency of it been spent. The only validly lost bitcoin is that sent to a burn address, like using the the usual OP-return method which means the output can never be spent, this is the only way the coin is lost in my opinion. Right most of all this assumed lost bitcoins could be long term holders who left it dormant

It will be difficult to correctly estimate the total number of lost coins. Some old dormant wallets which are suspected to contain lost coins can suddenly become operational in the future. In economics, the availability of an asset usually affects the price. Lost Bitcoins reduce the number of Bitcoins in the market which will slightly increase their worth. The higher the number of lost Bitcoin the more valuable the worth of Bitcoin.    

Since you are relatively new to Bitcoin, I advise you not to fall for the scam that all things lost can be found in the space because Bitcoin is one of those things that, if lost, cannot be recovered.

There have been many scammers who have tried many times to pose as having the capability to recover lost Bitcoin; some people have been victims of them, but to give you a warning, @OP, avoid such, because it is a scam!

It keep running on my head that how do we practically proof that there are lost bitcoins before deliberating on what would happen to them.
This is skeptical because there are long time holders who could even hold bitcoin for generational inheritance. So do we assume such wallet holding such bitcoins assuming over 15 years plus without processing of transcriptions all those while be termed lost funds as much as those who has lost permanent access to their wallets?
How do we literally different this ? I mean how can the system detect lost or misplaced bitcoins when the actually owners never voiced out?

But to my view, I think those misplaced bitcoins are gone forever but though I read that there is an ongoing development system that is being initiated to the capability of recovering those lost bitcoins but that would be determined in a far future .

Well firstly,I really don't know if you are a core English person or if English is your regular language (no offence) but I believe forum or community is a better fit for thid context than environment. However with respect to you point, lost coins simply means that the owner of that particular wallet lost his keys and his seed phrase. Which literally means there's no possible way of spending the coins in that wallet. Although it actually isn't a donation to the network, but it's literally similar to burning your coins.

To burn  some coins you send them to an address which you lost the keys and seed meaning there is actually no way to access or the coins.Lost coins are actually beneficial to the bitcoin network because it preserves price since it's like an anonymous HODLer is hodling indefinitely causing circulating supply to reduce increasing price.

In satoshi word, lost bitcoin is a donation to every other bitcoin holder and just as act said it a charity since it will never be recovered even though it exists in the network, but no one can ever have access to such bitcoin and that means bitcoin becoming more scarce which eventually will increase the value and price if bitcoin and that is the reason satoshi titled it as a form for donation.

This is a reoccurring topic in the forum. I’m pretty sure we discussed “what happens to lost bitcoins” a couple of times this year. To answer your question OP, I have to refer to this post from Satoshi:

Think of them akin to gold coins which have floated to the bottom of the ocean. They still "exist", but are unlikely ever to be usable again by anyone who owned them.

Bitcoin that is lost and cannot be recovered by the owners for some reason, will be as charity to the bitcoin community, and that will add to the value of bitcoin, because it will limit the quantity of bitcoin within the reach of people. This is why you need to backup your seed phrase in three locations far from each other to avoid a total lost, because you will not have access to your wallet anymore, and your bitcoin will be locked forever in the blockchain.

The lost bitcoin is part of the coin in circulation as it will add to the marketcap. But because they are lost, this will increase the value of bitcoin because it will make bitcoin to be more scarce.

If the owner of the coins lost their private key, the coin is lost forever.

Hello friends, this is my first discussion on the forum, and it's a pleasure to be part of this environment

I've always had a big question about the bitcoins in wallets that were lost over time. Of course, this is not something to worry about right now, but when will the limit of bitcoins be mined be reached? The circulation limit of the asset will not be just 21 million (value estimated by the system), it will be 21 million minus the bitcoins lost in wallets, which according to studies, is almost 4 million lost coins. This value will probably increase significantly as the year goes on.

What could happen to these lost bitcoins? Will they continue to be lost in "limbo"