24 Aug 2021 11:18 AM +00:00

34% Of Bitcoin Sits In Dormant Wallets - Is It Lost Forever?

A new report from Glassnode (via BeInCrypto)found that 33.96% of bitcoin is held in dormant wallets.

A total of 7,131,084 BTC sits in wallets that either belongs to long-term holders, or are lost.

This totals $354.62 billion of BTC potentially out of circulation – 16.5% of the overall cryptocurrency market cap.

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Bitcoin Lost (and Found)

The concept of potentially lost bitcoin is not a novel discussion, however.

Since its inception, countless individuals have shared their stories of forgetting or losing the keys for their cryptocurrency wallets.

Among the most famous of these relates to Satoshi Nakamoto – the founder of bitcoin. Satoshi last posted in 2014. This led to speculation from those in the community that the creator either passed away, or lost the addresses to his bitcoin wallet.

Research suggests Satoshi’s holdings – largely earned through early bitcoin mining – total over 1 million BTC. This would make up a significant proportion of the lost bitcoin.

According to research by wallet company Trezor, if holders lose a collective 0.05% of BTC every year, the cryptocurrency could become deflationary by as early as 2048.

However, a proportion of these dormant wallets could instead belong to long-term holders. Various dormant bitcoin wallets have ‘woken up’ in recent years, moving their holding out of the address.

Glassnode previously estimated 3 million BTC is lost, while Chainalysis stated it believes 3.7m BTC to be lost.

Elsewhere, the total proportion of bitcoin owned by long-term holders – those holding bitcoin for over 155 days– reached 67% of the total supply, or up to 84% when adjusting for lost bitcoin, reported analyst Will Clemente.

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[Featured Photo by DrawKit Illustrations via Unsplash]