29% Of Bitcoin’s Circulating Supply Is Now Presumed Lost Forever
According to recent findings from blockchain analytics company IntoTheBlock, around 29% of the total Bitcoin circulating supply is now presumed lost forever after remaining stagnant for over five years.
Bitcoin was designed to be scarce, with only 21 million coins ever to be mined, but the very features that make the cryptocurrency so attractive to investors can sometimes lead to investors losing their assets forever, especially in cases where private keys are forgotten.
Related Reading: Why Ripple’s Victory Against The SEC May Be Short-Lived: Legal Expert
Stagnant BTC Addresses Are Growing Over Time
In a recent tweet by IntoTheBlock, the company called attention to the high number of dormant bitcoin addresses. “Our data shows that 29% of $BTC hasn’t moved in over 5 years. It’s possible that a large part of this concerns lost coins,” the tweet said.
Similar data has been supplied by Glassnode Alerts, an on-chain metrics monitor. According to Glassnode, on-chain data shows that the total quantity of HODLed or lost bitcoins just hit a new all-time high of 7,781,224.168 BTC. Given that the price of a single Bitcoin is currently about $30,000, this equates to more than $235 billion in BTC that has now been lost.
What Does This Mean For Bitcoin?
Institutional interest in Bitcoin has grown in the past year, with companies like MicroStrategy doubling down on their bitcoin holdings. Hence, the increase in dormant addresses can show more people are holding Bitcoin as a long-term investment rather than trading or spending it. However, it can also signal the amount of BTC lost forever, especially by early investors.
Taking into account that early investors are more likely to cash out on the huge gains made by the price of bitcoin, the latter is more likely. The price of Bitcoin has skyrocketed over the years and small amounts of Bitcoin from the early days are now worth a fortune. So if investors still had access to these dormant BTC, then they would likely have been moved already.
As Bitcoin gained mainstream popularity, many people have also bought in without fully understanding how to secure their private keys properly. A good example is the case of Stefan Thomas, a San Francisco-based programmer who is unable to asses his holdings of about 7,002 bitcoins. Thomas’ holdings are currently worth $216 million, but he can’t remember the password containing the private keys to his digital wallet.
With bitcoin having a fixed supply, its increasing scarcity due to lost coins can also enhance its appeal as a store of value. This could drive the price up due to increasing demand for the fewer bitcoins in circulation.
Bitcoin has seen a surge in price in recent months fueled by spot ETF applications filed by major investment companies like BlackRock and Valkyrie. The cryptocurrency is up by 43% this year and is currently ranging around $30,000 for the past few weeks.
Read more: https://www.newsbtc.com/bitcoin-news/bitcoin-presumed-lost-forever/
Text source: NewsBTC
