In the future, if the natural loss rate of the Bitcoin network is 1%-2% per year, it is not a big problem, which is equivalent to 1%-2% interest for depositors. If the loss rate reaches more than 5% per year, will it seriously affect the circulation of Bitcoin.
I don't know where you get those percentages from but certainly your assumption is exaggerated. As of today, we are not losing anything close to 5% per year. At the beginning it was more normal that many were lost, because it was a new thing, which was worth very little and people were not careful. Today, in general, much more measures are taken to avoid losing your private keys, but even so, inevitably a small percentage will continue to be lost, much smaller than the 5% per year that you suggest.
But even if they were lost that much it would not be a problem because what would happen is that the rest would be worth more and when the time came a consensus could be reached to further subdivide the remaining ones. Just as 1 Bitcoin is equivalent to 100 million Satoshis, each Satoshi could be subdivided into 100 million miniSatoshis or whatever name you want to give it. And in fact, this is something that is already done with LN because millisats are used.
Problem solved.
A loss rate greater than 5% per year is an assumption, a possible scenario.
If the loss rate is too high, the person who owns Bitcoin first can take away the labor value of the new person who wants to own Bitcoin only by depositing coins.
This risk-free return is too high, and newcomers will no longer want to own Bitcoin because their labor is being exploited by others.
And subdivide doesn't solve this problem,What it solves is the convenience of currency use. Because no matter how subdivided, new people need to use labor to acquire new bitcoins.
