Author: Ricardo Filipe 2017-12-12 14:02:12
Published on: 2017-12-12T14:02:12+00:00
There is currently no way to avoid gradual loss of Bitcoins in transactions except for implementing a Dead Man's Switch. The Dead Man's Switch would cause Bitcoins assigned to dormant addresses to automatically expire, which is defined as an address that has not been used in transactions for some fixed length of time, such as ten years. This solution could potentially increase miner's rewards if a sufficient number of Bitcoins expire. Increasing the divisibility of Bitcoins is another proposed solution to avoid the loss of Bitcoins. However, this can only be done on 2nd layer solutions such as the Lightning Network, which has its own format. On the base layer, increasing the divisibility of Bitcoins would require a hard fork, which would undermine the invariants of Bitcoin.A proposal was made to extend the range of relative lock-times to allow for several years of expirations. This could be implemented by proposing a flag. It is estimated that approximately 4 million out of the 16.4 million Bitcoins ever mined are lost due to human error and loss of private keys. There is no way to eliminate these losses from circulation, but since the total number of Bitcoins that will ever be mined is capped at 21 million, the network will eventually come to an end.
Updated on: 2023-06-12T23:03:19.653526+00:00