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One of the early obituaries on that list mentions that the finite supply of bitcoins, combined with lost crypto keys and hoarding will eventually lead to a situ
by steeleduncan 9y ago
One of the early obituaries on that list mentions that the finite supply of bitcoins, combined with lost crypto keys and hoarding will eventually lead to a situation where there aren't enough coins for it to be a viable currency.
Clearly, in that situation you can subdivide coins as far as required, so it isn't a risk to bitcoin as such. However, I have often wondered if there is any estimate of the "effective supply", that is to say ("minted coins" - "coins where the private key is lost")?
- nkkollaw 9y agoI bet a lot of people lose their private key, but I bet that if there's anything in your wallet you'll be careful. So, there are probably a lot of private keys that get lost, but not a lot of bitcoins.
- steeleduncan 9y agoPragmatically, that is probably true, and bitcoin won't last for millenia either (e.g. if sha-256 has a weakness, or quantum computers render ecdsa useless). Nevertherless, there is >0 probability of multiple harddrive failure, or much greater probability of incompetence, so there must be some rate of loss of bitcoins over time, and i'd be interested to know what that is. I think it is interesting because once the speculation dies down, the market will set the fiat price of bitcoins according to the actual supply and demand, so this attrition has a real affect. For example, imagine if the coins believed to belong to Satoshi (1 million coins out of the current 16.5 million) were to move. The mere knowledge that they can be moved would increase the effective supply by 6-7% overnight, the effect could be dramatic.
- klez 9y agoWell, if you lost the private key at the beginning, when they weren't worth much, you wouldn't have been that careful. So I'd wager that there is a fair amount of lost coins around.