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)
I strongly disapprove of long abandoned/lost Bitcoins being reintroduced to the network for whatever reason. These lost or abandoned bitcoins will make the value of Bitcoin itself strong and it will prevent significant depreciation of Bitcoin in the future.
You're right but it's only a matter of time before these lost or abandoned bitcoins are reactivated. But the key here is that you have to be patient with these things. Lost Bitcoins are better off sitting idle forever. Because circulating bitcoins will add more value. But I think the coins will be recycled in the network