Quote from: Mia Chloe on July 09, 2023, 07:20:19 PM

I read some old threads about lost Bitcoins ND this question has been on my mind ever since
If the lost Bitcoins were for instance recovered will the price of Bitcoin drop because in theory it would affect the amount of Bitcoin in circulation which will lower it's price . I saw in those threads that lost Bitcoins are considered a donation to the Bitcoin network. so if my theory is correct then we should be happy those Bitcoins were lost.

If Bitcoin wallet addresses are lost, the Bitcoins associated with those addresses essentially become inaccessible. This is because Bitcoin transactions and ownership are tied to the private keys that correspond to the wallet addresses. Without the private key, it's impossible to access or spend the Bitcoins associated with a particular wallet address. So, if someone loses their private key or the information needed to access their wallet, those Bitcoins are effectively lost.

However, it's important to note that lost Bitcoins do not directly affect the overall supply of Bitcoin in the market. The total supply of Bitcoin is capped at 21 million coins, and this cap will not change due to lost Bitcoins. What can happen, though, is that the reduced effective supply due to lost coins might create a perception of scarcity and potentially influence market sentiment. If a significant number of Bitcoins are lost and cannot be accessed, we can argue that the scarcity could increase the value of the remaining accessible Bitcoins over the long term, as they become relatively scarcer compared to the fixed supply.