CZ estimates up to 4 million Bitcoin permanently lost forever

Binance founder Changpeng “CZ” Zhao said Saturday that between 10% and 20% of all Bitcoin already mined could be permanently inaccessible, putting the estimated amount of Permanetly Lost BTC at roughly 2 million to 4 million coins.

Zhao based his estimate on the amount of Bitcoin currently mined and the cryptocurrency’s fixed maximum supply. According to figures cited in his post on X, about 20.07 million BTC had already been mined, while only around 4.4% of Bitcoin’s eventual supply remained to enter circulation.

“I’d estimate 10-20% of existing Bitcoins are lost/stuck/unrecoverable,” — Changpeng “CZ” Zhao, Binance founder, in an X post.

Bitcoin’s protocol limits its total supply to 21 million coins. If a significant portion of the existing supply can no longer be accessed, the number of Bitcoin available for active use and trading could be substantially lower than the headline supply figure suggests.

Zhao consequently described Bitcoin as a “deflationary asset,” arguing that the effective supply can shrink as coins become permanently inaccessible.

The estimate has renewed attention around Permanetly Lost BTC and the unusual role that lost cryptocurrency plays in Bitcoin’s monetary economics. Unlike traditional currencies, Bitcoin does not have a central authority capable of restoring access to coins when their owners lose the necessary credentials.

Permanetly Lost BTC estimates include dormant Satoshi holdings

Zhao’s estimate is broadly consistent with figures from other industry analysts, although determining exactly how much Bitcoin has been lost is inherently difficult.

BitGo estimates that between 2.3 million and 4 million BTC, representing approximately 11% to 18% of Bitcoin’s eventual 21 million supply, may be lost or otherwise inaccessible.

Those estimates include approximately 1.1 million BTC believed to have been mined by Bitcoin’s pseudonymous creator, Satoshi Nakamoto, during the network’s earliest period. However, those coins should not automatically be classified as Permanetly Lost BTC.

The estimated Satoshi holdings remain untouched, but their status is better described as dormant rather than definitively lost. Without evidence that the private keys have been destroyed or become irretrievable, there is no way to establish that the coins will never move.

The distinction is important because dormant Bitcoin could theoretically return to circulation. Coins whose private keys have genuinely been destroyed or lost, by contrast, are effectively removed from the usable supply.

Bitcoin can become inaccessible for several reasons. Owners may lose private keys or wallet passwords, while others may die without leaving heirs the seed phrases or recovery information required to access their holdings.

Such incidents can permanently separate Bitcoin from its owner without affecting the blockchain itself. The network continues to record the coins, but nobody with the necessary credentials can authorize a transaction.

Permanetly Lost BTC strengthens Bitcoin’s scarcity argument

The growing body of estimates surrounding Permanetly Lost BTC adds another dimension to Bitcoin’s scarcity narrative.

Although the protocol’s maximum supply remains fixed at 21 million BTC, the amount that can actually be accessed by holders may be significantly smaller. Every permanently inaccessible coin effectively reduces the pool of Bitcoin available for transactions, investment and other uses.

That dynamic was central to Zhao’s description of Bitcoin as a “deflationary asset.” His argument is based not on a change to Bitcoin’s 21 million supply limit, but on the possibility that the effective circulating supply will continue to contract as more coins become inaccessible.

However, the precise amount of Permanetly Lost BTC remains uncertain. Blockchain data can show that coins have not moved for long periods, but inactivity alone does not prove that the owner has lost access.

The distinction also makes estimates vulnerable to revision. Some coins considered lost could eventually move if their owners recover old wallets, locate forgotten credentials or otherwise regain access.

For that reason, analysts generally present lost-Bitcoin figures as estimates rather than confirmed totals.