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Nearly 4 Million Bitcoins Lost Forever, New Study Says (fortune.com)

Posted by msmash on from the lost-in-transition dept.

An anonymous reader shares a report: According to new research from Chainalysis, a digital forensics firm that studies the bitcoin blockchain, 3.79 million bitcoins are already gone for good based on a high estimate -- and 2.78 million based on a low one. Those numbers imply 17% to 23% of existing bitcoins, which are today worth around $9,700 each, are lost. While others have speculated about the number of lost bitcoins, the Chainalysis findings are significant because they rely on a detailed empirical analysis of the blockchain, where all bitcoin transactions are recorded.

5 of 218 comments (clear)

  1. And nothing of value was lost by Anonymous Coward · · Score: 4, Insightful

    N/t

  2. It feels like late 2000 again! by Anonymous Coward · · Score: 5, Insightful

    It's beginning to feel a lot like late 2000 again. Those who were around then will remember how much hype there was around technology, and how the various stock market indices were constantly hitting new highs. Profit was the last thing that businesses were thinking about; it was all about growth. Even the most outlandish ideas were taken seriously. The future outlook was nothing but pure optimism.

    Then it all came crashing down just a few short months later.

    Just look at the outrageous valuations of so many Silicon Valley companies. Look at this cryptocurrency nonsense, where performing a single transaction requires more energy than an average American home uses in a month. Look at the nonsense coming out of moz://a, especially the silly Rust programming language and the terrible Firefox 57 release.

    There are a lot of people who will be in for a very rude awakening, and it could very well be happening much sooner than they expect!

    1. Re:It feels like late 2000 again! by Anonymous Coward · · Score: 3, Insightful

      and what was pets.com trading for? I think that's more along the lines of what he was thinking.

  3. Re:Does it matter? by timholman · · Score: 4, Insightful

    US coins/bills that are lost are simply made again. You can't do that with bitcoin.

    Which is precisely the point of using money. Money should be a measure and facilitator of economic value and activity, not a finite resource that is intrinsically deflationary. (The historical lessons of gold and silver as deflationary currencies are completely lost on the cryptocurrency crowd.)

    If I write a check for $1000 and give it to someone, and he accidentally destroys the check before cashing it, that $1000 is not "gone". The check had no intrinsic value to begin with. It was just a way to transfer value from me to him. All I need to do is write him another check. But once a BTC is lost, it is gone forever. The Bitcoin ecosystem has become a bizarro world where it makes economic sense for someone to find a way to sabotage your wallet and destroy your keys, as it makes the value of his own BTC that much greater (a la "Goldfinger" in the James Bond movie).

    The use of BTC as "money" has all but disappeared. Average transactions fees are currently above $5 USD. What is left is a speculative frenzy that is going to pop very dramatically. Sure, you might make some money as a speculator right now, but a lot of people will be left holding the bag when BTC crashes.

  4. ...for two reasons by Roger+W+Moore · · Score: 3, Insightful

    While I get your implied meaning the other reason you are correct is because these bitcoins are not lost. At some point it is highly probable that the encryption used will become easily breakable on some future, possible quantum computing, device. At this point the coins can be recovered...although the entire encryption behind bitcoin will also be undermined so they will probably be worthless!