Wouldn't it be better if lost coins were reintroduced into the network after a fixed span of inactivity?
I suppose the first thing one would say no for, would be by virtue of bitcoin's well-known deflationary property. This said, I believe it is much more important, especially in the longest term, that bitcoin keeps its property of conservation of energy, that is, having a fixed quantity of money ever available. By losing coins, instead, and by having them unrecoverable, we have not a fixed quantity of money available, rather a decreasing one, which is why we call bitcoin deflationary.
What would happen if we would make so that coins with 131 years of inactivity would be reintroduced into the network?
I see this having some positive effects:
- decreased impact of hereditary monopoly
- incentive to let the currency flow
- canceled the future necessity to increase the number of decimals for 1 BTC (very-long term perspective: too many coins have been lost, thus the necessity to further subdivide a coin)
The idea could be considered since mining and facilitating transactions is directly correlated with the current supply of bitcoin, so reintroducing lost crypto back to the market would spell good things for industry. Although it must be said that this only works if the supply is slowly increased, as flooding the market with lost bitcoins (if that's what you're going for) is a downright death wish. It will severely dilute bitcoin's value, and will cause multiple bank runs that could definitely end with bitcoin crashing.
Although in retrospect, with Satoshi Nakamoto gathering dust from elsewhere, who do we expect to do this for us?