One of the most attractive things about Bitcoin to investors and speculators alike is its fixed, known, maximum supply of 21 million BTC. There will never be more Bitcoin in circulation than that number. The reality is that there will never actually be 21 million BTC circulating either. The reason for this is the numerous situations where Bitcoin holders have lost access to their wallet, whether through actually losing/discarding the device the wallet was on, losing the recovery phrase, or forgetting a password.
The current estimate is that about 4 million Bitcoin are currently “lost”, meaning that there will actually only ever be about 17 million BTC in circulation, barring some sort of recovery of lost BTC by those that lost it. But what’s the most Bitcoin anyone has ever lost? We’ll discuss the most prominent losses while also discussing Satoshi Nakamoto’s Bitcoin holdings, which may never be accessed either.
Lost or Inaccessible?
Those that no longer have access to their Bitcoin fall into two categories, those who have physically lost the device which held their Bitcoin, and those that can’t access the Bitcoin but still have the device.
For the former, the most Bitcoin anyone has lost in this manner is about 8,000. James Howells, an engineer from Wales, had been mining Bitcoin for some time when in August 2013, he accidentally threw away the harddrive that contained the Bitcoin wallet.
Now, for those of you who use crypto currently, you’re likely wondering why Howells doesn’t just use his recovery phrase in order to restore the wallet on a new device. Well, the unfortunate part for Howells is that recovery phrases weren’t introduced until September 2013 with Bitcoin Improvement Proposal 39. This means that until that proposal was passed, the only way to recover your wallet was to have written down the private key somewhere, which most people didn’t do. Howells has been searching his town’s dump for the harddrive ever since he realized what he’d done, but to no avail. The Bitcoin on that harddrive is now worth well over $200 million USD, and at one point, was worth well over half a billion.
For the latter, the most Bitcoin anyone has lost in the form of being unable to access it on a device they still have, is about 7,000. Stefan Thomas, a programmer living in San Francisco, had his Bitcoin stored on an IronKey hardware wallet. This hardware wallet requires a user created password to access the funds on it, with the caveat that after 10 incorrect guesses the device will fully encrypt and lock you out from guessing again.
Unfortunately for Thomas, he lost the piece of paper where he wrote down the password. As of 2021, he had just 2 guesses left to try, but he’s come to terms with the loss and isn’t going to use up the two attempts anytime soon. It’s possible that over time there comes a way to “hack” his device in order to reveal the password, but that will be risky too.
Satoshi’s Bitcoin Stash
Apart from those that have lost access to their Bitcoin in one manner or another, there is also the never moving stash of Satoshi Nakamoto’s BTC. As they were the one to start the blockchain with the genesis block, they were also the one to mine about 22,000 blocks during the first year Bitcoin was online. Overall, it’s estimated that about 1.8 million BTC was mined by Nakamoto, with 1.1 million still never being spent. These numbers were discovered by Sergio Lerner, who identified a pattern that allowed him to attribute the mining to one entity.
Will Satoshi’s Bitcoin Ever Move?
Nakamoto’s stash has never moved, and if and when it does that will be an extremely interesting day, as Nakamoto could single-handedly crash the market. That’s not something the creator of Bitcoin would likely want though. Those that have claimed to be Nakamoto in the past have never been able to prove it’s them by moving any amount of funds from any of the numerous wallet addresses associated with them.
Closing Thoughts: Always Use a Backup
There are likely many other stories of lost Bitcoin out there, though likely not to the scale of the losses presented in this article.
There’s also numerous folks that sold Bitcoin for pennies in the early days, including the infamous 10,000 Bitcoin spent on two pizzas back in 2010. While Bitcoin Pizza Day is celebrated within the community, the financial loss by the seller is likely haunting him to this day. Thankfully, current wallet systems have all sorts of backup options, making it increasingly hard for losses like Howell and Thomas’ to occur. Be sure to write down your recovery phrases, passwords, and so forth, and keep them somewhere safe.