Bitcoin’s price soared to over $ 56,000 on Friday, pushing the combined value of all bitcoins beyond the $ 1 trillion mark – at least in theory. This is more than Facebook’s market capitalization, although Apple, Alphabet, Amazon and Microsoft are worth more. Bitcoin’s value has almost doubled from $ 29,000 since the beginning of the year.
I say “in theory” because not all bitcoins are actually available for use. Each bitcoin (or fraction of a bitcoin) is protected by one or more cryptographic signatures. To transfer a bitcoin, you need to know its corresponding private key. And some of those keys have been lost – and it is impossible to know how many.
For example, a Briton says he threw out a hard drive in 2013 that contained the keys for 7,500 bitcoins – valued at around $ 400 million at today’s price. He asked for permission to dig the dump that contained the hard drive, but the request was denied.
This type of incident has been repeated many times in the past 12 years. It was probably an especially common occurrence in the first two years of bitcoin operation, when you could get a bitcoin for a fraction of a cent. In 2010, a man paid 10,000 bitcoins for two pizzas – a transaction now widely recognized as the first commercial payment of bitcoins.
At that time, it was common for people to mine a few hundred bitcoins – or even many thousands – and then forget about them, since they might be worth too little to be worth selling them. When owners realized that bitcoins were valuable, the data may have been lost.
The largest bitcoin stock in the world is probably the one belonging to the pseudonym bitcoin creator Satoshi Nakamoto. In the first months of the cryptocurrency, Nakamoto is estimated to have mined more than 1 million bitcoins.
Nakamoto never revealed his true identity and disappeared from public view in 2011. No one knows whether he is still alive; those 1 million bitcoins have not been transferred since they were created more than a decade ago.
But if Nakamoto kept the private keys, his net worth would be more than $ 50 billion today – enough to put him among the 20 richest people in the world.
Two other likely bitcoin billionaires are Tyler and Cameron Winklevoss. Harvard alumni gained prominence during a legal battle over the origins of Facebook as a social network for Harvard students. After settling their legal battle with Mark Zuckerberg, they spent $ 11 million to buy bitcoins in 2013. At a reported price of around $ 120, they could have received almost 100,000 bitcoins – which would have given them a net worth of several billions of dollars today.