We all know how infuriating it can be when a misremembered password keeps you from accessing an government healthcare exchange or an old Neopets account. For Bitcoin investors who have lost that crucial string of characters while the market booms, multiply that frustration by several million. The New York Times reports that many would-be Bitcoin big shots are unable to access millions of dollars in cryptocurrency because they can't remember the security key to their digital wallet.
One of Bitcoin's main selling points also makes the lockout particularly frustrating. Its decentralized and anonymous nature means that there's no record of passwords for these piles of suddenly very valuable cybercoins and no one to ask for a replacement password. Investors must either remember their password or give up on their fortunes.
Stefan Thomas, a San Francisco- based programmer who spoke with Times, is staring down a barrier between himself and $220 million worth of Bitcoin. Thomas was given around 7,000 of the coins by an early investor, a payment for making a video explaining the currency. Each of those coins is currently trading for over $30,000.
Thomas' situation is particularly bleak, because he locked his digital wallet away inside a system that would destroy the currency after 10 incorrect guesses. After eight incorrect tries, Thomas has put the hard drive away in the hopes of finding another solution. Other Bitcoin users noted in the story have lost hundreds of millions in locked away coins.
Bitcoin blog Chainalysis estimates that nearly 1 in 5 Bitcoins are permanently lost. The value of these discarded or forgotten Bitcoins is nearly $140 billion.
While cryptocurrency has been around for over a decade, the recent boom and some high-profile endorsements have made Bitcoin all the more visible. Last year, the rapper Logic purchased millions of dollars worth of the currency and Carolina Panthers Tackle Russell Okung became the first NFL player to have part of his contract paid out in Bitcoin.