Maybe I remembered it wrong, or maybe I was just out of date. Thanks for the correction! Still, that's basically pointing at key attrition being a fairly minor phenomenon.
Yes; we're talking about 20% or so over 16 years, which is 1.25% per year, four times lower than the 5% per year inflation you're saying people complain about. And the anecdotal data suggests that that key attrition was concentrated in the early years, not just before there were Bitcoin ETFs, not just before there were exchanges, but before even the Bitcoin pizza.
But the big issue from my point of view is not the actual key attrition rate but the uncertainty of the money supply, because from my point of view, these are the important questions about key attrition:
- If Bitcoin goes to zero, what order of magnitude of money will the investor class lose? 200 trillion dollars, 20 trillion, 2 trillion, 200 billion, 20 billion, or 2 billion?
- How much money and power has Bitcoin transferred to its early adopters: 2 trillion, 200 billion, 20 billion, 2 billion, or 200 million?
- How much impact could awakening dormant coins have on the market? If Satoshi, or for that matter Hal Finney's heir or another early participant, started liquidating his early coins, would that be a tenth of the usual daily trading volume? Ten times? A hundred times?
Questions like these are why lolc brought up key attrition in response to ducksinhats saying, "It offers stability and a mathematical escape from very fallible humans controlling monetary systems."
A key attrition rate of 99% or 90% to date would result in very different answers to these questions. But 20% or 50% to date is fairly minor in this context.
