In most cases, these coins cannot be recovered and are permanently removed from the currency circulation supply. Most of the time, it is possible to recover lost bitcoins, but there are conditions that we will cover in this article.
Millions of dollars in Bitcoin and other digital assets are lost every year.
Where do lost bitcoins go?
Unlike fiat currencies like the US dollar, Bitcoin is designed to have a limited supply. While central banks can always print more notes, no new bitcoins can be produced after all 21 million coins have been mined. Lost and lost bitcoins reduce the coin's maximum supply. According to research, 4% of existing bitcoins are lost every year. While Bitcoin was designed with a limited supply of 21 million coins, it is estimated that only 14 million Bitcoins are currently in circulation due to the rate at which coins are lost.
A report cited by the New York Times states that of the 18.5 million bitcoins mined so far, about 20 percent appear to be inaccessible or lost. At the time of the report, the value of inaccessible bitcoins was around $140 billion. Proponents of this theory believe that the lost coins only serve to increase the value of the remaining currency, as scarcity increases the value of Bitcoin. Do you think it is possible to recover lost bitcoins?
How are bitcoins lost or misplaced?
There are different ways to lose or steal Bitcoin, and we will discuss 15 of them below
Hackers of digital currencies
Crypto Signal exchange hacks account for the largest number of lost bitcoins. Exchanges are good targets for cybercriminals. The first hacked exchange was Mt.Gox, a dedicated Bitcoin exchange. Since then, many major exchanges have lost 9.4% of their total assets, including Bitfinex, Bitstamp, and most recently Cryptopia, a New Zealand-based cryptocurrency exchange.
Phishing
Cybercriminals steal investors' Bitcoins by obtaining usernames, passwords, logging into online wallets and withdrawing all coins.
Some of the most common Crypto VIP Signal phishing scams are scammers impersonating exchanges using emails that look very similar to exchange emails. In the form of emails, they often ask you to click on a link inside the email and fix a problem with your account. This link is a fake page and collects your login information. Notably, Ethereum is the hottest target for phishing schemes.
Ponzi schemes
A Ponzi scheme is a type of scam where early investors receive quick profits with funds from newer investors. A Ponzi scheme has no real way to make money and offers people unrealistic returns.
An example of a cryptocurrency Ponzi scheme was BTC Global, which promised investors a return of "2% per day or 14% per week". In this scheme, 28,000 South African investors lost about $1 billion.
Recover lost bitcoins
Fake cryptocurrency wallets
Fraudsters create fake wallet apps and place them on the Google Play Store. They often mimic real cryptocurrency wallet apps. The goal of these fraudsters is to get people's capital and steal their digital currencies.
Some of these programs ask users for their private keys and wallet password upon launch so that those details can be used to withdraw Crypto Signal Leaks from real wallets.
Catfishing
Fake social network accounts are created by impersonating reputable projects or people in the field of digital currencies. This method is used in combination with phishing to gain access to user account login details.
For example, you get a Twitter account that impersonates the founder of Ethereum and the owner of that account tells you that if you deposit your ETH into an account, your cryptocurrency will double. Not only has crypto fame been used for phishing schemes, but even financial figures and celebrities such as Richard Branson may be used.
Malware
Many malwares have been created and placed on various sites to steal digital currencies. For example, there is a malware program called Clipper that fraudsters use to copy users' wallet addresses and steal their digital currencies.
For example, if you want to send bitcoins to an address, you would normally copy and paste the address because it is a long string of random characters. Clipper malware changes the wallet address when you paste it, which means you are sending the Futures Signal to the thief's address.
Is it possible to recover bitcoins lost with malware? The answer should be no. Because the transaction that has been done cannot be returned.
Experienced investors know how to analyze projects based on the development team.
Counterfeit initial supplies
Newcomers to the Indicator Crypto market fall prey to fake Initial Coin Offerings (ICOs) that present themselves as a high-yielding new cryptocurrency investment. They use FOMO or fear of missing out. These projects will never materialize and the funds will not be returned to the investors.
Experienced investors know how to analyze projects based on the development team. In this way, they find out whether the developers of this project have the necessary skills to implement their promises and whether they have already set a specific goal or not.
Pump and dump designs
Pump and dump are price manipulation. Scammers use social media groups to hype projects or tokens known as "awesome coins". These coins have no added value or real use, and in this way, they intend to increase their price.
Once the value increases, the fraudsters sell their tokens and immediately after the crowdsale, the token price drops dramatically. This causes people who held their coins for longer or bought them at higher prices to suffer huge losses. In this method, famous people are often used to create hype about the digital currency in question.
Damaged or lost hardware wallet
There are stories of people who lost their coins in the early days of Bitcoin. Bitcoin was not worth much at that time. When old computers were broken or hardware wallets were lost, the stored coins were also lost. In this case, it would be impossible to recover the lost bitcoins, unless the wallets are equipped with a recovery phrase system.
Negligence and carelessness
By sending your bitcoins to the wrong addresses, you will lose your cryptocurrency. Some wallets and exchanges have options that prevent users from sending coins to the wrong wallets.
Recover lost bitcoins
Misplaced private keys
People lose their private keys. Even the owners of the wallet and private key will die without sharing it with anyone else. A recent example is the death of Gerald Cotton, the CEO and founder of Canada's largest cryptocurrency exchange QuadrigaCX. This resulted in $250 million worth of digital currency being stolen because the owner did not share the wallet keys with a trusted person.
Digital currency crypto exchanges
Cryptocurrency exchanges that appear out of nowhere, don't share much information about the company, and then disappear with the client's capital
SIM card and phone number theft
Phone numbers are stolen to access investors' cryptocurrency accounts. Last year, a 19-year-old made headlines when he stole more than $1 million worth of Bitcoin using a SIM card swap tactic.
Classified ad scams
Scammers advertise a fake ad for the sale of an item such as a car and demand payment in Bitcoin. Victims pay bitcoins, but will never get their car or bitcoins back, as transactions are irreversible. As another example, the same type of scam is common when looking for an apartment to rent.
The moral of this story is, never make a payment for anything before seeing the actual car and valid documents.
Bitcoin ransom
Criminals kidnap important people and demand ransom in the form of bitcoins or digital currencies for the victim's release. Another is when hackers take over a private company's online platform and demand Bitcoin as a ransom to regain control. Bitcoin extortion emails are also common, trying to blackmail people to prevent their information from being made public.
Now that you know some of the most common ways people lose their Bitcoin and other digital currencies, it will be easier for you to prevent some of these unfortunate events from happening. You may never know how much your digital currency will be worth in the next few years, so it's best to take good care of them. In the following, we will discuss how to recover lost bitcoins.
How to recover lost bitcoins?
Theoretically, recovering lost bitcoins is possible under certain conditions. If you have the primary or private keys of a wallet, you can always access the bitcoins stored in it using them. These keys are called recovery terms or seeds.
If you lose access to the wallet, or the private keys, the cryptocurrencies stored in the public wallet addresses are no longer usable and are considered lost forever.
For this reason, you need to be very careful and keep the recovery phrase carefully so that you can recover your wallet and capital with its help if needed. However, you should also remember that anyone who has access to that recovery phrase can use the Bitcoin or cryptocurrency stored in the wallet.
However, if you lose bitcoins in this way, what you need to do is to look for a recovery phrase. Try to remember where you saved this data.
If they are not saved or you no longer have access to them, you can check if you have backed up the wallet before. In fact, some wallets allow you to create a backup file that allows for full recovery. However, it's important to note that anyone who has that backup can restore the wallet, so if you're going to do that, you'll want to make sure you store it somewhere super secure.
Recover lost bitcoins
Is there another way to recover lost bitcoins?
Without recovery statement or wallet backup file, recovery of lost bitcoins will not be possible.
Unfortunately, there is no other acceptable solution. Lost bitcoins can only be recovered by restoring the wallet with the private keys stored in it, if you have a backup, or by recreating a new wallet using the seed statement.
For this reason, if you decide to store your bitcoins in a dedicated wallet and not hand over the management of your wallet to a third party such as an exchange, you should make sure that you have a backup copy of your wallet or recovery phrase.
On the other hand, this operation is not without risks, because if someone else has this data, they can access your wallet without restrictions.
For these reasons, many people prefer to rely on third-party wallets or wallets that offer a recovery method. However, this means giving wallet managers access to their bitcoins.
Most likely the best solution for recovering lost bitcoins is to keep your wallet recovery data in a super secure, private and easily recoverable way.
When sending Bitcoin transactions, the first thing you should pay attention to is the recipient's address.
How to keep your Bitcoin safe?
Since most cases of lost Bitcoin can be attributed to user error, it's good to know what to look for to keep your holdings safe. This will make it possible to recover lost bitcoins.
What should we pay attention to when spending Bitcoin?
When sending Bitcoin transactions, the first thing you should pay attention to is the recipient's address. As we explained in the previous section, most wallets are effective in preventing transactions from being sent to an address that does not actually exist. However, you should make sure that you don't confuse two valid addresses. For example, you may have an old address in the recipient field that you forgot to change.
Double-checking the correct address is very important, as the cryptocurrency industry is full of phishing scams that try to trick people into sending cryptocurrency to their address. These scammers often pretend to be a reference or someone you know. Once you send them Bitcoin, there is no way to reverse the transaction. In fact, transactions are irreversible.
Additionally, fake browser tools and malware can make it look like you're sending bitcoins to the right recipient, when you're actually sending your money to a scammer. To make sure you don't fall victim to malware or scams, it's important to verify the exact address of the recipient.
Which cryptocurrency wallets are more secure?
Some hardware wallets, such as Trezor, protect your bitcoins and allow you to verify the address of transactions through a secure display. This means that even if malware or a fake browser extension changes your intended address, Trezor will still show the real address on its screen so you can cancel the transaction.
This is just one example of secure wallets. If you want to know the best cryptocurrency wallets, reading this article will help you.
Recover lost bitcoins
How to keep your digital assets safe?
When storing digital currencies, the safest option is to choose cold storage using a hardware wallet. These wallets are much more secure than online and software wallets. By storing assets on secure hardware that is not connected to the Internet, you can reduce potential risks.
It is very common to lose access to your Bitcoins in case of device or hardware failure, so it is important to have a backup to avoid losing your digital currencies and recover lost Bitcoins. This backup can be as simple as having a file that stores a copy of your wallet.
Hardware wallet cryptocurrency storage solutions allow you to store your digital currencies offline and avoid the risk of your assets being stolen. These wallets are also equipped with a way to restore access to digital assets, should something happen to your physical device.
When you use a wallet for the first time, you'll be provided with a 12-word recovery phrase. This phrase allows you to retrieve all the coins you have stored in your wallet.
It is important to keep this recovery statement in a physical form such as handwritten on paper in a safe place. We strongly recommend that you never store it digitally. If you are unable to access your wallet for any reason, you can regain access to your assets using the recovery phrase.
Last word
Every year, millions of bitcoins are lost and out of circulation for various reasons. According to research, about 20% of all bitcoins in existence will be lost forever. At the time of publication, about 3.8 million bitcoins have never been recovered.
In this section of Kiosk Academy, we tried to check the methods of losing Bitcoin and other digital currencies. We also explained how to recover lost bitcoins. But to avoid losing your coins, you need to consider all the points mentioned in the text to keep your capital well.
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