Bitcoin Supply Cut Due To Lost Keys And Burning

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  • Bitcoin Halving is basically a mechanism to control its supply and supply of the same is set at 21 million coins.
  • The 21 million supply is expected to be mined by 2140 which means that by 2041 no new BTC will be in circulation and users won’t receive block rewards anymore.
  • A huge amount of Bitcoin is lost due to lost private keys, forgotten crypto wallets, and dead Bitcoin users.
  • It is estimated that at least 2,700 BTC are burned which means 2,700 BTC is deducted from the BTC supply forever. 

Bitcoin Halving is basically a mechanism to control its supply and supply of the same is set at 21 million coins. Meaning at a given point of time there will be not a coin more, not a coin less. So are all the 21 million BTC minted at one go and what happens if they were to be minted at one go? 

The 21 million supply is expected to be mined by 2140 which means that by 2041 no new bitcoin (BTC) will be in circulation and users won’t receive block rewards anymore. But another significant fact is that currently 88% (approximately) of the total supply i.e, 18.5 million has been minted already and a relevant amount of BTC has been lost. Unfortunately, the lost BTC can in no way be recovered. This implies that the available amount of BTC left for mining is much less than the estimated value. 

20% Of BTC Hasn’t Been Moved In The Last 5 Years

Currently, BTC is trading at $11,836.23 and is down by 1.51% in the last 24 hours as of August 8th. After a prolonged period of stability, BTC has finally managed to rise above the $9300 value and has been holding at $11000 for some time now. However, despite its recent spikes in price, the volume or the capital hasn’t moved more than 20% of BTC in the last five years. 

A large number of traders have sent BTC to wallets that do not have any private keys. Once BTC is sent to these vanity addresses, it is impossible to recover them meaning it is lost forever. Some common addresses for burning BTC are Bitcoin Eater and Counterparty. Any amount of cryptocurrencies sent to the addresses are lost forever. It is estimated that at least 2,700 BTC are burned which means 2,700 BTC is deducted from the BTC supply forever. 

Forgotten Wallets And Deceased BTC Owners Contribute To Lost BTC

A huge amount of Bitcoin is lost due to lost private keys, forgotten crypto wallets, and dead Bitcoin users. A month ago, a Reddit user found 533 BTC in his deceased brother’s laptop. But it was almost impossible for him to access those rewards because he didn’t know the private keys. 

Moreover, Satoshi Nakamoto the pseudo-anonymous founder of BTC had mined 1.1 million BTC in the initial months of Bitcoin. The value amounts to a gargantuan $1 billion today. However, not a single BTC has moved since Satoshi disappeared from the public. The amount held by him amounts to 5.9% of the total BTC supply.

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