$220 MILLION IN BITCOIN AT RISK TO BE LOST
More than $ 140 billion in bitcoins lost forever: what does this mean for the market
Chainalysis estimates that about 20% of all BTC is considered lost
This could lead to a shortage of bitcoins in the future.
Custody services can be a possible solution to the problem.
Cybersecurity experts remind that bitcoins worth more than $ 140 billion are considered “lost or inaccessible”.
Britain’s National Cyber Security Council published a weekly report in which it recalled that the amount of bitcoins lost or unavailable by users could exceed $ 140 billion.
No keys – no coins
The British National Cybersecurity Council, in its latest analytical report, has focused on the topic of inaccessible and lost bitcoins. In particular, the experts considered such aspects as losing a password or deleting a key due to incorrect formatting or disposal of a hard drive..
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The reason for this was the recent stories of extremely unlucky owners of BTC. For them, the lost bitcoins have become a big problem. So recently the editorial staff of BeInCrypto talked about former Ripple employee Labs, which lost the keys to a bitcoin wallet that holds 7,000 coins worth about $ 220 million.
Next, we also reported about an unlucky Englishman who threw an old hard drive into a landfill, where 7,500 bitcoins worth over $ 312 million were stored..
Lost bitcoins and liquidity crisis
In addition to moral trauma for unlucky hodlers, lost bitcoins are fraught with consequences of a different kind..
According to recent statistics from the analytical company Chainalysis, at the moment, bitcoin owners have lost access to about 20% of all coins in circulation. At current market value, this is equivalent to $ 134 + billion.
Experts clarify that they consider such lost bitcoins to be coins that have not been in motion for five or more years. In their opinion, the main reason for the loss of coins is the loss of private keys by users or erroneous transactions (transfer of funds to the wrong address).
Read also: Young crypto investors do not plan to bequeath their assets to anyone
At the moment, almost 89% of the total MTC supply is in circulation. In this regard, some members of the crypto community predict an imminent liquidity crisis. They expect demand for bitcoins to significantly outweigh supply.
Accordingly, the latest activity of institutional investors can only exacerbate this crisis. For example, Grayscale is actively increasing the size of assets under its management and now owns more than 3% of the total supply of MTC. Tries to keep up with MicroStrategy.
Some worry that this could have a detrimental effect on the decentralization of the entire ecosystem. Others are just happily expecting it to push Bitcoin to new all-time highs..
Is there a solution?
However, this will be a weak consolation for those who lost their precious coins through an annoying oversight. Custody services can be a possible solution – for example, from Coinbase.
Their number is now increasing, and they all offer the owners of bitcoins to entrust in the hands of professionals all worries about the storage and security of cryptocurrencies..
This approach is reminiscent of traditional ways of saving, when citizens rely on the experience of intermediaries such as banks and foundations. Perhaps in such a high-tech environment as the crypto space, professional help becomes even more important..
However, this fundamentally contradicts the ideas of the creator of Bitcoin, Satoshi Nakamoto, who developed this cryptocurrency to free personal finances from the control of any institutions. No wonder one of the favorite sayings in the crypto space is “not your keys – not your coins”.
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