Topic: theoretically there are 21 mil btcs, in reality, many bitcoins are lost (Read 2165 times)

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.

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.

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!

I agree with this very much. LOL

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

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.  

Yes, when u think about it, its pretty scary how deflationary bitcoin is.
Alot of coins generated in the start were lost/forgotten, and with each new day, u probably have some new cases of loosing coins.

While the actual accurate data is a mistery, im happy with deflation; it makes bitcoin even more rare, and i believe that is a good thing.

Cheers

I mean, many bitcoins exist in block chain, but nobody in the world knows their private key. They are in a unspendable state. Anyone has a guess how many these coins are?
From economy point of view, a healthy currency should grow its supply at the small rate, to reflect more human output, and not inflate itself. Bitcoin is a deflationary currency, and the rate of deflation probably greater than we think.

haha, dream big! Only if USD turns into Zimbabwe dollar, which is a possibility.

100 million satoshis to a bitcoin...consider for example 1 satashoi eventually getting to $1  1 bitcoin would then = $100 Million or large enough for a small economy.

Does not matter.

1 bitcoin could be used for the economy of a small country.

Personally I think the more bitcoin that gets lost the higher the value should go. I say this because there is less to go around. If we are all sharing a piece of big pie that has 19million slices it is certainly worth more then the same pie that has 21million slices.