At the time of writing, around 19 million Bitcoins have been mined, however, that does not mean all of them are actually accessible. While many of these are safe and sound in people's wallets or resting on exchanges like Binance or Coinbase, a large quantity are likely stuck in wallets with no one knowing how to access them. But what is the largest lost Bitcoin wallet out there?
We all know that if you do not have the correct details to access a self-custodial Bitcoin wallet, then you will never be able to retrieve the money inside. However, not everyone recognizes the sheer scale and magnitude of wealth lost because of this. While it may seem unusual to think that someone would be so careless as to lose their wallet access details (such as their private key or mnemonic phrase), it is important to remember that Bitcoin spent many years being worth under $1000.
In fact, it was not until 2013 that Bitcoin even reached three figures, which means that during its formative years, it was worth very little. Therefore, there are likely many people who mined or stored Bitcoin early on without seriously considering how they should maintain its accessibility. That being said, even in more recent years, some people have made the mistake of misplacing or losing their storage details.
With this in mind, let's examine the largest lost Bitcoin wallet and see just how much of BTC's circulating supply resides in it. To some extent, one could argue that crypto losses due to inaccessibility are a significant part of the industry, as most people are not accustomed to managing their own money without the assistance of intermediaries or third parties. Stories like this also serve as an excellent cautionary tale about the dangers of misplacing crypto details.
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What Makes a Bitcoin Wallet Lost?
When trying to answer the question, "What is the largest lost Bitcoin wallet?" we first need to decide how we will determine this. At first glance, this sounds like a straightforward topic, as we all intuitively understand what it means to lose something ourselves. However, ruling something that belongs to someone else as lost is slightly more complicated, because it typically requires the owners to declare it as lost.
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The anonymous (or at least pseudonymous) nature of cryptocurrency means that obtaining these details is not always easy. For instance, there are many wallets in the Bitcoin realm that hold substantial wealth and have not had transactions leaving them for years. These wallets might be lost and inaccessible, but it can be challenging to definitively say this as they might not be lost at all; instead, someone could be holding onto them.
Additionally, these wallets might lie dormant for other reasons. For example, some people have been arrested for illegal activities, preventing them from using their wallets, only for those wallets to be accessed at some point in the future. One such example is a wallet linked to Silk Road, the infamous illicit black market that used Bitcoin as its primary payment method.
Despite Silk Road being shut down by law enforcement in 2012, and its founder, Ross Ulbricht, still serving two life sentences in prison, there was significant movement in 2020 from the wallet. After being dormant for approximately seven years, around $1 billion worth of BTC was moved within 2020. Before this transaction, this was the fourth-largest Bitcoin wallet in existence.
This wallet could have been accessed by the original owner, who might have been keeping the funds due to fears that moving the money would attract too much attention, or because they were in prison and could not access their computer. Alternatively, the wallet could have been hacked (although that possibility ranges from a long shot to being nearly impossible).
If the wallet was dormant for so long, but accessed by the owner, then it would be incorrect to declare this wallet as lost, rather than simply being untouched. If it was hacked, then this could definitely be a contender for the largest lost Bitcoin wallet, as the funds would now belong to someone else, essentially having been stolen.
In a similar vein, the infamous Mt. Gox hacker wallet could be classified as lost if you measure loss only by the duration the wallet has been dormant. This wallet contains 79,957 BTC (or over $2 billion). This wallet has a potent legacy and mythology surrounding it. On the same day it was created, March 1st, 2011, it received a single transaction of 79,956 BTC.
These funds were stolen from Mt Gox (or from Mt Gox users, depending on whether you believe the creators of the platform were involved in the theft). Since then, zero funds have been moved from it. Some believe the private key for this wallet is lost, which could indeed make it a viable contender for the largest lost Bitcoin wallet.
However, it's equally possible that the owner still has the details but is concerned about the legal and social pressure that would ensue if they accessed it. Like the previously mentioned wallet, it is also possible that the owner is in prison, waiting to access the funds.
What About Deceased Owners?
There may be another reason why some wallets are never be touched again - their rightful owners are deceased. If someone has never left instructions on how to access their wallet, which is very likely as doing so would immediately compromise their wallet security, then when they die, there is a high chance their fortune would be stranded in their wallet.
For any wallet that has been dormant for many years, there is a non-zero chance that the individuals who could access them are now dead. With traditional assets, such as fiat currency and stocks, these can be relatively easily transferred to an heir or a named person within a will, and the state can assist in this process. However, with cryptocurrency, the self-custodial nature of it means this can only be done if the deceased owner left explicit cryptographic instructions.
One example could be Mircea Popescu, a controversial figure in the Bitcoin community who died in 2021. Popescu was a problematic figure, known for his sexist and anti-Semitic comments. He was also thought to be one of the largest Bitcoin holders. We do not know what address, or addresses, he owned, so it cannot be confirmed with certainty that they are dormant since his passing.
Though there is a high chance that this is true, as his death was premature– he drowned at the age of 41, and he may not have put provisions in place for someone else to take ownership of his fortune. There are speculations that he owned $2 billion worth of Bitcoin. If this is held in a single Bitcoin wallet that nobody has access to, then it could indeed be the largest lost Bitcoin wallet.
However, should this count as a loss? Typically, when we speak about something being lost, we refer to it in the context of the owner not having it. If the owner is deceased, does it still make sense to use this terminology? It depends on what we mean. One could argue that these funds are not exactly lost but are simply gone, much like how Mircea Popescu is gone.
It might be unusual to say they are lost as they never belonged to any living individual. However, we could view loss in a more abstract way, and say they are lost to the entire Bitcoin community, as they may never be accessed by anyone else. In that sense, loss would be viewed as a collective experience, rather than one focused on a single individual.
To some extent, this is true, as inaccessible wallets result in a reduction in circulation. While the official number of Bitcoins in circulation is around 19 million, this is far from a true reflection of active BTC. In fact, renowned Bitcoin analyst, Timothy Peterson, has predicted that 31% of the BTC circulating supply is lost forever.
Using this metric, if you were to ask, "How many Bitcoins are lost?" then the answer would be 6 million. That's a huge number, especially considering that there are only 1.6 million BTC left to mine. The fact that so many Bitcoins are lost has led some to argue that Bitcoin has an inherent, albeit accidental, deflationary quality.
This is not the traditional definition of deflation, which is when the general price level of goods and services in an economy decreases over time, indicating an increase in the value of the currency itself. However, it could still be used in this context because 'deflationary,' in terms of Bitcoin, can denote a decrease in the active supply of Bitcoin due to lost coins. Coupled with increasing or constant demand, this can lead to an increase in the value of each individual Bitcoin.
This is a form of asset deflation and could increase the purchasing power of Bitcoin, much like traditional deflation increases the purchasing power of a currency. It is fair to say that recovering these lost Bitcoins would be difficult or potentially impossible, effectively taking them out of circulation, possibly permanently.
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Burned Wallets
There is a special category of Bitcoin wallet that could be relevant to our discussion. So far, we have been building a list of lost Bitcoin wallets that are formed from deaths or accidental losses. However, some wallets exist that contain BTC that have been taken out of circulation intentionally. These are known as burned addresses, and they hold cryptocurrencies that have been sent from people who are explicitly trying to reduce the flow of certain assets.
Burned addresses are meant to be inaccessible, meaning they have a known public key, but an unknown private key, implying that nobody can ever send money from them. Burned addresses are not especially common in the BTC world, but they are more widely used by a variety of other blockchains.
For instance, the address "0x000000000000000000000000000000000000dead" is used by many projects in the Ethereum ecosystem, which might even include Binance’s BSC devs using it (although there is some speculation about which burn address they actually use). 0x0000000000000000000000000000000000000000 (often abbreviated to 0x0) is an alternative burn address.
The Bitcoin community also uses burn addresses for some reasons. However, there is no set standard for which address should be used. One well-known burn address for Bitcoin is 1111111111111111111114oLvT2, which holds 495 BTC. These funds can never be accessed, as it is suspected that there is no private key for them. However, this is by no means the largest lost Bitcoin wallet used for burning.
One potential wallet that eclipses this is 1CounterpartyXXXXXXXXXXXXXXXUWLpVr. This is an address that was created by a project called Counterparty, a member of the Bitcoin ecosystem. In addition to being a burn address, this is also a vanity address, which is a term used to describe wallets that use some human-readable features to distinguish them from other wallets (such as the fact that the word "Counterparty" is incorporated into it).
The Counterparty address contains 2130 BTC. This may be lower than some of the wallets previously listed, but it has one feature that the others do not– we can be much more certain that nobody has access to them as it is highly unlikely (or perhaps impossible) to find a private key for this address.
Technically, every public address has a private key, but those keys may be impossible to find because vanity-generated addresses are constructed in a way that makes cracking them even harder. These addresses are not lost in the sense that somebody misplaced their access details, but we could say they are lost to the entire Bitcoin community.
Is Satoshi’s Address The Largest Lost Bitcoin Wallet?
Sometimes people present Satoshi Nakamoto’s address as the largest lost Bitcoin wallet. He has a known address, which is 1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa. This is referred to as Bitcoin’s genesis address, meaning it is associated with Bitcoin’s first block.
However, there are two issues that arise when discussing this. For starters, taking a peek at the blockchain explorer reveals that there are only 72 BTC in it, which is a particularly low amount. This is lower than every other address mentioned so far, so why do people think it is the largest?
There was a report conducted that argued that, while this address contains less than 100 BTC, Satoshi may have wallets that contain around 1 million Bitcoins altogether. It is hard to prove this, but people have found certain mining patterns from many years ago that point to one miner. Considering the Bitcoin public ledger highlights the richest wallets in existence, but does not list any wallet with this much in it, the general thought is that Satoshi spread their BTC around multiple wallets.
The second issue is that it is not confirmed that Satoshi does not have access to these Bitcoins. We only truly know of one address associated with them, and while they have not accessed it yet, it does not mean they cannot. And the fact that we do not know any other addresses means that nothing can be definitively proven. With this in mind, I believe it would be unsound to say that Satoshi has the largest lost Bitcoin wallet, as we simply do not know enough.
Largest Traditionally Lost Bitcoin Wallet
I have discussed a range of different wallets that could be lost, but let’s round this off by taking a look at an example of a wallet that is confirmably lost in a more traditional sense. By that, I mean a wallet that has a living owner who has explicitly told the world that they cannot find the details needed to access it.
A great example of this is James Howells, a British Computer Engineer who lost his hard drive, containing details for a Bitcoin wallet that holds 7500+ BTC. It may be the largest Bitcoin wallet that has been classified by the owner as lost. It is a simple and traditional type of loss, and it serves as a fantastic cautionary tale for everybody within this industry to be careful with their details.
The process of recovering lost Bitcoins is extremely hard, and rarely do we hear about success stories. There is no definitive way to find lost Bitcoins; this is more of a feature than a bug. Self-custodial services like cryptocurrency are built in a way that prevents third parties or intermediaries from being able to create backdoors or access your money for you.
This means that, if you lose access to your funds, then you are on your own in trying to find them. At least, this is the case with using decentralized wallets. If you use exchange wallets, such as those provided by Coinbase and Binance, then losing your details may not be the end of the world, as these companies act as custodians. If you prove to them beyond a shadow of a doubt that you are the account holder, then they can reset your password and provide access.
While the crypto world often pushes for self-custody, with people regularly repeating the mantra of “not your keys, not your coins”, it is not without some drawbacks. Self-custody means you need to work very hard to keep your details safe and accessible. But that accessibility needs to be exclusive to the owner. This means you need to walk a tightrope of making your details available to you forever, while making them nearly impossible for malicious parties to reach.
What Happens to Lost Bitcoin?
There has been a lot of BTC that has been lost to the world. This naturally leaves some people wondering what happens to these losses. The answer is a little anti-climactic, as a true loss, where no private keys, passwords, or mnemonic phrases exist, simply means that they lay inside inaccessible wallets for all of eternity.
Theoretically, it could be possible that these wallets could get hacked at some point in the future. If the owner exists and finds a way to gain access, then this lost Bitcoin would get recovered, and could be marked as “found”. If somebody else hacks them and does not return them to the owner, then we could either consider them as still lost (to the owner), or we could say they are found in the sense that they are back in circulation.
The likelihood of hacking a wallet with today’s computers is very low, as it would take thousands of years to use brute force to find a private key for a specific wallet. However, it may be possible for quantum computers to one day help achieve this. As it stands, the quantum computers that exist in this day and age probably would not be strong enough to do this, but their underlying technology is getting more and more impressive, so maybe this can happen several years down the line.
However, there is a caveat. If a quantum computer was ever proficient enough to crack a BTC wallet and help recover lost Bitcoins, then the world would have some very big problems that it would need to fix. This is because BTC uses a relatively typical type of encryption, called SHA-256, that is used for file encryption, password hashes, and some email clients. Needless to say, this could cause worldwide security issues.
Additionally, if a BTC wallet was to get broken into, and this fact was discovered, then it could lead to a fall in Bitcoin’s price, as it would no longer be seen as secure as previously thought, and could trigger panic selling. This might create a strange situation where it may not even be worth hacking a lost Bitcoin wallet, as the act of doing so could tank its value.
However, to some extent, this is more of a predictive discussion about the future. What happens to lost Bitcoin in the current day is very different. Assuming they stay lost forever, then they contribute to the deflationary nature of the cryptocurrency (as mentioned earlier). While the loss of Bitcoins is not typically thought of as an intentional element of the network, it was predicted by Satoshi Nakamoto, who has spoken in the past about such happenings.
In 2010, they took to the Bitcointalk forum and discussed the situation, stating that “lost coins only make everyone else's coins worth slightly more. Think of it as a donation to everyone”. This is an interesting perspective– Satoshi Nakamoto is essentially saying that the losses help to make everybody else’s BTC worth more as they contribute to the scarcity of the market.
This is a relatively positive take, as it presents the loss of BTC as a gain for the entire community. It is a very different spin on the previously presented idea that the potential largest lost Bitcoin wallets actually hurt the community due to a reduction in circulation. Both perspectives are valid and worthwhile.
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Conclusions
Several contenders have been listed as the possible largest lost Bitcoin wallet. Let's organize them so that they can be compared. First off, the largest wallet discussed is more of a collection of wallets, attributed to Satoshi Nakamoto. If true, this would amount to around 1 million BTC. However, the wallet addresses are unknown, and it is unclear if Satoshi truly has no access.
Next would be the infamous Mt. Gox wallet, containing 79,957 BTC. It is unproven whether it is lost, or if the owners are merely laying low, but it is certainly dormant. Following this is the late Mircea Popescu’s wallet(s), containing approximately $1 billion worth of BTC. This would amount to around 37,897 BTC. However, it might be odd to say they are lost, as their owner has not lost access but has rather ceased to exist.
Then we have James Howels’ fortune of 7500+ BTC. This is confirmably lost, as the owner has clearly stated he cannot find the appropriate details. It is our cut-and-dry example. After this, we get to the Counterparty intentionally burned wallet, containing 2130 BTC. This wallet is not lost in the sense that it was accidentally misplaced, but the funds are certainly inaccessible. Counterparty uses it as a deliberate means of burning, and so, depending on your idea of loss, this may or may not count.
Altogether, these wallets amount to 1,127,484 BTC. This is a huge number, accounting for a tremendous amount of BTC's current circulation. Whether you consider these to be the largest lost Bitcoin wallets will depend on your own definition of the term, but one thing that is certain is that they definitely do not seem accessible at this current moment. Losses like this are the nature of self-custodial finance. The only way to combat this is to keep hold of your details, or to use a custodial service like Binance or Coinbase.
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