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Jameson Lopp: what is the real bitcoin price, given that 6 million BTC are lost forever or stolen?

Jameson Lopp, the Senior Engineer at BitGo and CasaHODL developer said that by now, approximately 4 million bitcoins are lost forever and 2 million more stolen from the users’ accounts. He made this statement at Building-on-Bitcoin conference that took place in Lisbon on July 3-4.

As of July 2018, a total of 6 000 000 BTC are inaccessible and untraceable on the blockchain network. Given that nobody is going to launch a hard fork in order to restore the full numbers, 28.5% of the bitcoin’s fixed supply (21 000 000 BTC) are, most likely, irretrievably lost.

Hence, the maximum supply of bitcoins will never exceed 15 000 000, even despite the fact that 17 000 000 BTC were already mined. Only 11 000 000 of currently existing bitcoins are actually in circulation.

Back in November 2017, Chainalysis, a research company that studies the bitcoin blockchain, estimated the total amount of lost bitcoins between 3 790 000 and 2 780 000. Thus, the upper boundary for this estimate proves to be close to reality.

According to the senior economist at Chainalysis Kim Grauer, it is hard to tell at the moment, whether the lost bitcoins are taken into consideration by the market or not, due to the highly speculative nature of bitcoin trading.

“That is a very complex question. On the one hand, direct calculations about market cap do not take lost coins into consideration. Considering how highly speculative this field is, those market cap calculations may make it into economic models of the market that impact spending activity. Yet the market has adapted to the actual demand and supply available – just look at exchange behavior. Furthermore, it is well known monetary policy procedure to lower or increase fiat reserves to impact exchange rates. So the answer is yes and no,” – Grauer explained.

The current BTC price hovers somewhere around $6 600. However, should the information about the real supply of bitcoins ever become available to general public, the bitcoin price may raise to $10 300 per coin, the factor of deficit being taken into account.