Sleeping beauty Bitcoin wallets wake up after 14 years to the tune of $2B

I don't really follow bitcoin, but last I checked over 75% of block confirmations came from the top 3-5 mining pools. That seems a hell of a lot more centralized than the traditional finance system.

> successful currency

Calling it a currency is a huge stretch. It’s an extremely successful token/“asset” but it’s about as much as a currency as gold is these days if not less (based on what most people use it for).

- It's not a currency.

- It can absolutely blocked by third parties (either the exchange you use or the mining cartels can).

- in practice its liquidity is tied to the liquidity of the ”stablecoins” (USDT and the likes) and as such it's not “the most liquid” since the liquidity of those stablecoins is higher.

No, scamming people is much easier with crypto. The transactions are irreversible, for one.

[delayed]

A hyper deflationary asset cannot ever be a proper currency.

Yeah that is awesome, it's great technology but it's still not anywhere close to a revolution.

> he finally gave up

Sounds like something someone who found few billion USD on a thumb drive would say :)

That’s definitely also what I would publicize if I actually found the HDD. :)

Source?

https://x.com/howelzy

Ross Ulbricht?

Keys created with an RNG that turned out to be a little too predictable?

Or some other flaw found in a wallet’s key generation?

Kinda like what happened here: https://news.ycombinator.com/item?id=6195493

(Or exactly that but nobody tried to attack this again with moar power?)

Better odds: old man theory.

Some dude had the wallets on a usb drive. Maybe he mined in the very early days, never really thought of it, and ended up aged and not cognitively aware, his memory wonky.

Recently, he just passed on.

His offspring cleaned out his garage or whatever, found a usb stick, looked on it for photos, and found this.

> closely related to each other.

Like, sequential? Because if you were brute forcing...

It's not zero. https://lbc.cryptoguru.org/trophies

He may have burned the keys, not the coins. The process of burning the coins is by sending them to an address such as: 1111111111111111111114oLvT2

I see it as the ultimate honeypot. If those coins haven’t moved yet the network is secure.

the CIA actively relies on many means, including BTC, to organize their activities.

If I had 8 billion in cash in my bank account and put in a transfer order, they'd block it, call me, make me come into a branch, make sure there weren't any burly guys with wrenches escorting me in, and maybe call the FBI if anything seemed off.

And if it was still legit after that, there would be days or weeks of waiting for the transfer to actually happen, during which time I could call and cancel.

This is the other edge of that double edged sword of "no regulations". It's a lot easier to steal bitcoin with no consequence because there isn't an entire financial system backed by people with guns to help you if you are wronged.

Bitcoin doesn’t ask questions when you unexpectedly want to make a very large transfer to a new payee. Your banker will.

What does Micheal Saylor do?

Someone actually did that, a few months ago. 320M in BTC was converted to monero and the price of monero increased by 50% [0]

[0] - https://slashdot.org/story/25/04/28/198238/monero-likely-pum...

Not quite that simple, that’s vulnerable to an Eve-Alice-Eve attack. If $1B in BTC moves around in short succession the TXs can be linked easily. You need a mixer that splits up the amount to be paid out, and even then it needs to be done piecemeal.

I doubt there's enough liquidity to swap that kind of money...

Monero daily volume is like $50m lol

The expected discounted value of all bitcoin's future cash flows is zero. This is because the only cash flow that a bitcoin investor can expect from an investment in bitcoins is the revenue from selling the bitcoins in the market... and the market value of something that has no use case and is held for speculative purposes only (i.e. has no intrinsic value) will tend to zero in the long run.

A fiat currency that is issued by the government has no intrinsic value either, but there's one crucial difference compared to a cryptocurrency: in the case of a government-issued fiat currency the central bank will intervene the market, by making use of its prerogative to conduct monetary policy, to ensure price of the currency doesn't drop to zero.

It's not backed by a government, and while some may say that's a good thing, I think it is not.

Without institutional backing, crypto is just a number in a database that people agree is worth something—for now.

If that collective belief evaporates, there’s no court, no army, no tax base, and no GDP to catch it. Contrast this with fiat currency, which—while not backed by gold—is backed by coercive power and taxation.

Let’s start from something even more fundamental. How do you bootstrap trust? Suppose two pseudonymous entities online want to exchange money for services. Such a system will likely need a reputation system to establish the trustworthiness of entities. That system needs to be tolerant to Sybil attacks (i.e., forging multiple identities), while also ensuring the service provider isn’t exploited by a buyer who refuses to pay after receiving the work.

But this exposes a deeper issue: trust cannot be bootstrapped from scratch. It needs either:

    A shared history (which pseudonyms lack),

    An external authority (which decentralization avoids), or

    A system of credible, enforceable consequences (which requires identity or stake).

Without these, any trust system collapses into a prisoner’s dilemma. Each actor is incentivized to defect (cheat) unless:

    There’s a future cost to cheating (reputation loss that matters),

    There’s a benefit to cooperation over time (e.g. recurring jobs),

    Or there's a credible mechanism to enforce fairness (e.g. escrow and arbitration).

But even escrow only works when dispute resolution is possible and trusted. And dispute resolution requires either a neutral arbitrator (who must have their own identity and incentives) or hard-coded, binary rules, which rarely capture the complexity of creative or service work.

More fundamentally, trust-based systems are built on recursive assumptions:

    You trust X because X has a good rep.

    X has a good rep because others say so.

    You trust those others because…?

Eventually, without a root of trust—whether a state, a court, a verified identity, or long-standing social capital—the entire structure becomes circular. There’s no ground truth. Just reputation built on sand.

And so, the real limitation isn’t crypto per se—it’s that trustless systems don’t exist. At best, we shift trust: from institutions to code, from names to keys, from legal consequences to probabilistic deterrents. But the requirement for trust itself never goes away.

In a pseudonymous setting, the cost of betrayal is minimal. A buyer can stiff a seller and vanish. A seller can deliver garbage or nothing. Reputation can be reset at will unless there’s an expensive cost to identity creation or a strongly linked personal history—which violates pseudonymity.

Thus, bootstrapping trust in such environments is not just technically hard—it is philosophically incoherent without compromising at least one of the pillars: privacy, decentralization, or enforceability.

It follows that if you can’t bootstrap trust, you can’t bootstrap anything that depends on it—including money. Money, at its core, is a social contract, a belief system upheld by collective trust. We accept currency in exchange for goods or services because we trust that others will accept it from us in turn. That belief is reinforced by institutional structures: central banks, governments, legal systems, and ultimately, enforcement mechanisms.

But the moment that trust breaks down, the system unravels. If people no longer trust that their money will hold value tomorrow, they will try to offload it as fast as possible, converting it into hard goods, foreign currency, or anything perceived as more stable. This behavior accelerates inflation—sometimes catastrophically.

We’ve seen this repeatedly in history:

    In Weimar Germany, the collapse of political and institutional trust after WWI led to hyperinflation, with prices doubling every few days.

    In Zimbabwe, trust in government policy collapsed alongside the economy, and the currency became worthless.

    In Venezuela, rampant inflation was fueled not just by bad economic policy but by the public’s loss of faith in any institutional ability to right the course.

The underlying mechanism is always the same: money ceases to function as a store of value when the population no longer trusts the system that issues and manages it. Once the shared illusion cracks, even fiat currency—backed by laws, taxes, and armies—can become just colored paper.

Now contrast that with crypto. Cryptocurrencies claim to solve this by removing central authorities and placing trust in mathematics and distributed consensus. But this is not true trustlessness—it's merely replacing institutional trust with collective belief in code and game theory. And the cracks are showing: when confidence drops, as in market crashes or protocol failures, value disappears just as quickly—if not faster—than in fiat regimes.

So the uncomfortable truth is this:

    Money only works if you believe it will still work tomorrow.

Without enforceable trust, money becomes unstable. Without shared trust, money becomes meaningless.

And that brings us back to the core issue: you cannot build a functioning economy without some root of trust. Whether that root is institutional, social, or cryptographic, it must be anchored, persistent, and costly to betray. If it’s not, the system becomes inherently fragile.

The reason I used pseudonymous here is exactly because we assumed govs are bad. If govs are good, then crypto degenerates to just a slower system for transactions.

Other currencies get their value because the governments that provide them make people pay taxes. If you want to pay the tax the US government charges you, you're going to need some USD - so there's guaranteed demand, and hence intrinsic worth.

There's also other debt that the US government provides in USD - which provides value as well, in the form of bonds.

BTC has no such driver of wealth. Except perhaps money laundering/transfers without AML provisions.

Also if you approach Coinbase/Kraken/$exchange and tell them you have X million to offload, they'll probably let you do it off-market, so no one (except for the ledger, obviously) would really notice.

> but is there any reason you would immediately need that much?

Because you worry that BTC will crash and want it in something more stable?

nah, they are worth that much because of inflated valuations

Most addicts would likely not hold Bitcoin in wallet, but spend it on getting their next fix as soon as they buy it. It's not like you're thinking long-term, invest in Bitcoin so you can buy more drugs down the line. There would be leftover change but not big amounts.

he only had $40 million . if he had $1 billion the feds would have known about it

Yep. I used to pay my Dish Network bill with BTC. Youth is wasted on the young and hindsight is 20/20

This is definitely something I remind myself of for any investment I sell and later on explodes. For bitcoin there were way too many highs that I definitely would have sold at.

I know, that's why I'd like to have the wallet now :)

Even if BTC hits 1 million in the future, 150k now would be life changing.

It is under-appreciated that inflation actually is desirable in a working economy.

Look at it this way. If your money (in money form) is worth less tomorrow than today, you are incentivised to spend it, thus fueling economic activity of all sorts (from going out and buying a drink to buying a car, traveling, investing). If your money is worth more tomorrow, then you are incentivised to tighten your belt and not spend for as long as you can. At scale, this negatively affects production, economic mobility, and so forth; the rich get richer and hoard the money. I do not believe any of today’s economies can be healthy and competitive (or even functional) with a deflationary currency.

> When I listen to Bitcoin discussions, one of the advantages people bring up is that there is a limited number of it and you can’t just “print” more.

Which can limit economic growth. When money was based the amount of gold available, there were long periods of economic stagnation because of liquidity issues:

* https://en.wikipedia.org/wiki/Long_Depression

* https://en.wikipedia.org/wiki/Great_Bullion_Famine

The stagnation only ended when new sources of shiny rocks were found (California; New World).

I find it a dumb idea what whether or not people can get credit to start/expand businesses would be dependent of solving math problems. Yes, credit creation can be "too easy" and become a problem, but making it "too hard" (or physically/mathematically impossible) is even more dumb.

What happens when all bitcoin is mined, societal collapse?

Which is equivalent to deflation, which parent suggests is harmful to bitcoin's viability. In order to claim that "this is fine" you would need to refute the claim that deflation is bad.

> Losing some bitcoin is effectively equivalent (over the long term) to distributing it to all other holders (proportionally). So this is fine.

To those that have, more will be given. What about those that do not have?

You can't actually know if they are truly lost or not, though. Any dormant wallet could reactivate at any time, just like the wallets in this story.

You can buy a lot of pizzas with it now

It’s a solid store of value. One can borrow against that held BTC, and as it appreciates over time, the loan-to-value ratio improves, without having to do anything. Also avoids capital gains taxes since you're not spending it.

Bitcoin is the world's number one store of value for converting young, impressionable men's wages into thin air and moving those dollars to other people instead.

It's a compelling rival to multi-level marketing for women in that both prospects entice low-socioeconomic standing peoples into thinking they are building value instead of consuming it.

The original bitcoin whitepaper was titled: “a peer to peer electronic cash system”

> Deflation is a good thing when you are parking value.

And is deflation a good or bad thing for the livelihood and well-being of human beings?

How many people in the US has a mortgage or some kind of debt (student, medical)? Inflation makes the burden of debt easier, deflation makes it worse.

And the Top (0.)1% already has an easy enough time with parking/generating value. Deflation would only help them more (and make things hard for everyone under them).

This is just a convenient way to access stable western currency. Having been to Russia and Argentina during their worst inflation years before crypto, they solved their issues by asking for US paper dollars. Crypto is just saving them currency exchange fees.

And there's no way Turkiye is behind the value of BTC. It's still driven by speculators.

> Turkish lira is steadily inflated over the last 30-40 years, well over 10% and recently over 50%.

Because the authoritarian government took over the previously independent central bank and lowered interest rates. Higher inflation was predicted by mainstream economists, and they were right.

* https://www.aljazeera.com/news/2021/3/20/turkeys-erdogan-sac...

* https://en.wikipedia.org/wiki/Currency_interventions_under_E...

> and smashing success of Bitcoin.

It's a success today, we haven't gotten to when they stop issuing any more, and mining is funded by transaction fees. I suspect there are going to be some problems then.

That's downstream of P vs NP.

I learned about it from my friend, but couldn't bother with downloading a wallet client and mining etc

A superposition of wrong and right if there ever was one.

It is still a scam. Its just that critical mass of delusional people bought into it like Gamestop or Tesla stock. Even super obvious scams like Nikola take years to register price wise.

As someone who has been into crypto since 2012 and isn't rich, yep

You're supposed to be able to fill in the second half of the sentence based on context. They consider it to be obvious from the first half.

Wasn’t 10k bitcoin the price of a pizza or something back then?