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Sleeping beauty Bitcoin wallets wake up after 14 years to the tune of $2B

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191 points aorloff | 7 comments | 04 Jul 25 18:41 UTC | HN request time: 0s | source | bottom
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throw0101d ◴[04 Jul 25 19:49 UTC] No.44467342[source]▶
Personally I think that this can be considered on the "bug" side of Bitcoin's finite number coins: if, over time, they are lost, then there's a smaller quantity† of currency that is useable to actually do stuff with.

This can make the 'rate of deflation' that occurs worse:

* https://en.bitcoin.it/wiki/Deflationary_spiral

* https://isps.yale.edu/news/blog/2014/06/the-perils-of-bitcoi...

* https://crypto.bi/deflationary/

† I am aware of satoshis.

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TheDudeMan ◴[04 Jul 25 20:08 UTC] No.44467486[source]▶
Losing some bitcoin is effectively equivalent (over the long term) to distributing it to all other holders (proportionally). So this is fine.
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nosefurhairdo ◴[04 Jul 25 20:42 UTC] No.44467729[source]▶
Which is equivalent to deflation, which parent suggests is harmful to bitcoin's viability. In order to claim that "this is fine" you would need to refute the claim that deflation is bad.
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hn_throwaway_99 ◴[04 Jul 25 20:46 UTC] No.44467760{3}[source]▶
> Which is equivalent to deflation, which parent suggests is harmful to bitcoin's viability.

Deflation is built into Bitcoin by design and is one of its most notable features regarding its coin growth schedule. This pros and cons of that approach have been discussed ad infinitum in the crypto community.

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1. agumonkey ◴[04 Jul 25 20:53 UTC] No.44467812{4}[source]▶
I wonder when did cypherpunks started to discuss this kind of mechanisms for digital currency. Was it obvious from day one or an idea that came later in the design phases.
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2. logicchains ◴[04 Jul 25 21:03 UTC] No.44467875[source]▶
There were early attempts at inflationary cryptocurrencies too but they didn't catch on; all other things being equal, people prefer to hold currencies that gain value over time, not lose value.
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3. jimkleiber ◴[04 Jul 25 21:06 UTC] No.44467891[source]▶
And the word currency, or current, implies movement, no?

So I think it's the issue of thinking people will use it as a currency, not that it is not a valuable asset

4. lumost ◴[04 Jul 25 22:10 UTC] No.44468292[source]▶
The finite nature of btc, low transaction volume, and increasing cost of mining made deflation a given. The original designers simply did not solve this problem. BTC’s dominance in the crypto community suggests that this trait was advantageous for BTCs growth as existing holders are incentivized to add additional use cases/transaction volume.
5. throw0101d ◴[04 Jul 25 22:42 UTC] No.44468528[source]▶
> Was it obvious from day one or an idea that came later in the design phases.

The Bitcoin paper came out in 2009, and the deflationary criticism was already recorded in 2010:

* https://en.bitcoin.it/w/index.php?title=Deflationary_spiral&...

2014 article:

* https://isps.yale.edu/news/blog/2014/06/the-perils-of-bitcoi...

6. wmf ◴[04 Jul 25 22:47 UTC] No.44468568[source]▶
Cypherpunks were discussing digital gold and Austrian economics in the 1990s. I wouldn't say there was any kind of consensus but the ideas were out there.
7. kragen ◴[05 Jul 25 10:30 UTC] No.44471683[source]▶
Not only were they already discussing it when I joined the list in 01992, cryptocurrency was a major, if implicit, part of Tim May's crypto-anarchist manifesto which I think he presented at Hackers in 01988: https://groups.csail.mit.edu/mac/classes/6.805/articles/cryp...

He wasn't specifically calling it out as having a fixed money supply or even fungible tokens, though. And it wasn't until Satoshi figured out how to do without a central issuer like Xanadu, Digicash, or e-gold that we realized it was possible. At the time that Satoshi cut the knot, we were all convinced it was impossible because of Zooko's Triangle.

Chaum founded DigiCash in 01989, incidentally, based on a paper he wrote in 01982 presenting a cryptocurrency design for untraceable payments, but backed with dollars by a central issuer, like Tether.

However, there was always a strong association between cypherpunks and right-libertarian free-market ideology, which is where you find gold bugs and Austrian economists. You may remember that one of the minor plot points in Atlas Shrugged was that Galt's Gulch went back to specie money (tiny pennies stamped from gold) because its value wasn't dependent on government fiat.