Here’s How $30 Billion In Bitcoins Got Lost Forever

Cold Storage is one of the most interesting features of Bitcoin as it allows us to reserve cryptocurrency with extra precaution. It could be done using a USB drive, a paper wallet, an offline Bitcoin hardware wallet, etc. However, if you lose the access to such cold storage device, your digital currency gets lost.

The above-mentioned scenario is one of few scenarios that involve missing of bitcoins. Studying the same, Chainalysis, via Fortune, has found out that about 3.79 million Bitcoins are out of circulation, according to a high estimation. This accounts for about $30 billion.

As a result, when all 21 million Bitcoins will be mined by the year 2040, the total numbers available for trading would be significantly lower.

The analysis made here depends on segmenting the existing bitcoin supply based on age and transaction activity. The company also used statistical sampling for some segments.

lost bitcoins forever
Image: Fortune

In another table of the same data, which is shown above, the “mined coins” section reflects the ones mined in 2017; “transactional” section refers to those coins that were moved/spend last year. There is also a category of “holder” — these are Bitcoins which might have the possibility of being hoarded as well.

It would be safe to say that this loss of Bitcoin will occur in the future as well. However, this rate will decline significantly as they’re now so valuable.

A big assumption in the study of Chainalysis deals with Bitcoin’s inventor, Satoshi Nakamoto. Wallets associated with Satoshi have been assumed to be lost. In case, in future, if this assumption turns out to be wrong, there would be a sudden increase in the number of Bitcoins in the market.

Also Read: 10 Interesting Facts About Bitcoin That You Must Know
Adarsh Verma

Adarsh Verma

Fossbytes co-founder and an aspiring entrepreneur who keeps a close eye on open source, tech giants, and security. Get in touch with him by sending an email — [email protected]
More From Fossbytes

Latest On Fossbytes

Find your dream job