Chainalysis: So many bitcoins are considered lost forever

• More than a million bitcoins are believed to have disappeared
• In 2022, $3.8 billion worth of crypto coins were stolen in hacker attacks
• Lost coins are not actually lost, they are stuck in the blockchain

What are “zombie coins”?

Typically, “zombie coin” is a derogatory term for cryptocurrencies that continue to exist but offer no long-term value. So this is mostly about cryptos where the drop in price and trading volume is a sign that the currency is in decline. While some coins are permanently declining, others are recovering, which is why the term “zombie coin” was coined, as CryptoVantage explains. However, the term also finds another use. As BTC-ECHO explains, citing US blockchain analytics firm Chainalysis, there are more than a million bitcoin in 2023 likely lost forever in the vastness of the blockchain. In such cases, too, the analysts speak of “zombie coins.”


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Large part of cryptos is lost through hacker attacks

But how are the crypto coins lost? While a large proportion of cryptocurrencies are lost through hacker attacks, investors occasionally lose, misplace or forget their private keys. One of the most famous examples of this is the case of James Howells, who even became a minor celebrity through his bitcoin loss. During a clean-up campaign in 2013, he disposed of a hard drive that contained 8,000 bitcoins. According to Chainalysis, a total of 1.46 million Bitcoin will be lost in 2023, writes BTC-ECHO. However, if you don’t just look at Bitcoin, there are far more lost coins. According to reports from CBS News, hackers stole a record $3.8 billion worth of cryptocurrencies worldwide in 2022 alone. The analysis company Chainalysis therefore describes the past year as “the greatest year ever for crypto hacking”.

Where are the lost bitcoins?

But where are all these coins? Strictly speaking, the missing “zombie coins” are not actually lost, explains BTC-ECHO. Rather, they are stuck in the blockchain. And that probably forever, should someone not accidentally find their private keys or a future AI manage to guess the private security key using a brute force attack. So, to protect yourself from losing crypto coins, you should make sure that the coins are kept safe from hackers in a cold wallet and that you keep your private keys in a safe place.

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