A cryptocurrency analyst, Timothy Peterson, claims that 1,500 bitcoins are irretrievably lost every day, meaning only 14 million BTC will ever circulate. This figure starkly contrasts with estimates from many organizations, including Markets.bitcoin.com, which place the figure at 18.5 million coins.
Losses Outpace Mining Output
Peterson, the CAIA Manager at Cane Island Alternative Advisors, argues that the average daily loss dwarfs the 900 bitcoins mined per day. To support his contention, he points to a research note published by his firm earlier in the year, which introduced the term “irretrievably lost” into the bitcoin lexicon. The document explains that such bitcoins represent funds that “are gone, no longer part of any economy anywhere” and are unable to be transacted, with recovery costs exceeding the value obtained.
4% Annual Loss Rate Since 2010
According to the research, about 4% of bitcoin's available supply has been lost each year since 2010. This puts the current available supply at approximately 13.9 million coins, well below the 18.3 million total supply figure publicized. It means that about 28% of all bitcoins have been irretrievably lost. Peterson references earlier studies by Ratliff (2014) and Chainalysis (2017) to bolster his claims.
Debate and Skepticism
Peterson's assertions have drawn challenges. Some critics, such as the Bitcoin Rabbi, argue that the figure of 1,500 bitcoins lost daily is too high. However, Peterson retorts: “The Chainalysis report, if you do the math, says 1,900 per day as of Dec 2017. My numbers are more conservative than that.” Another Twitter user questioned that such a rate implies all 21 million bitcoins would be lost within 30 years.
Despite skepticism, there is agreement that the actual circulating supply could be lower than the often-reported 18.5 million. The irreversibility of bitcoin transactions and numerous documented cases of lost private keys—such as the wallet containing 69,370 BTC that hackers have been trying to crack for years—reinforce the reality of permanent loss.