What happened?
MicroStrategy purchased 1,070 Bitcoins in the last two days of 2024, costing about $101 million, with an average purchase price of about $94,004, securing MicroStrategy's position as the publicly listed company holding the most Bitcoin.
MicroStrategy CEO Michael Saylor recently stated that he will destroy all Bitcoin private keys he holds after his death to 'benefit' Bitcoin holders worldwide.
The reason he has such an idea is that by reducing the 'total supply' of Bitcoin, the scarcity of Bitcoin can be further enhanced, thereby driving up the long-term value of Bitcoin and benefiting all holders.
MicroStrategy CEO announces that he will destroy Bitcoin keys after death
MicroStrategy, as the publicly listed company holding the most Bitcoin globally, purchased another 1,070 Bitcoins in the last two days of 2024, costing about $101 million, with an average purchase price of about $94,004.
This move brings its total holdings to 447,470 coins, accounting for approximately 2.1% of Bitcoin's total issuance, with a total investment amount of about $27.97 billion and an average cost of about $62,503 per coin.
In addition to continuously increasing his Bitcoin holdings and advocating others to follow suit, Bitcoin believer MicroStrategy CEO Michael Saylor recently further proposed his personal Bitcoin legacy plan during an interview with foreign media: he will destroy all Bitcoin private keys he holds after his death.
Saylor described this move as 'a proportional contribution to all Bitcoin holders worldwide.' He believes that by reducing the total supply of Bitcoin, the scarcity of Bitcoin can be further enhanced, thereby driving up the long-term value of Bitcoin and benefiting all holders.
The total supply cap of Bitcoin is 21 million coins, and more than 19.92 million Bitcoins have been mined, accounting for 94.878% of the total supply, leaving about 1.07 million coins left to be mined. If the private key is destroyed, no one will ever be able to buy or sell these Bitcoins, permanently reducing the circulating supply of Bitcoin, thereby increasing its value, which benefits all Bitcoin holders.
In other words, this decision means that the massive amount of Bitcoin he holds will never be usable by anyone and will completely disappear from the circulation market.
Saylor's remarks sparked heated discussions within the cryptocurrency community.
Opponents argue that this approach is too wasteful, contrary to the principles of financial inclusiveness and practicality of Bitcoin, and could further distort the Bitcoin ecosystem after being adopted by whales.
However, some supporters believe this is an 'advanced diamond hands' strategy (referring to long-term holding), which will make the price trend of Bitcoin even more 'crazy' regardless.
Could Bitcoin disappear?
Saylor's 'destroy private key' declaration is not only about handling his personal wealth but also reflects his expectations for his position in Bitcoin history. He hopes to be remembered by future generations not only as an early investor and staunch supporter of Bitcoin but also as the one who 'took the torch from Satoshi Nakamoto' and successfully pushed Bitcoin towards corporate and governmental levels for commercial application decades later.
But this also raises a thought-provoking question: when Bitcoin holders pass away, where will this digital gold go? Will it forever disappear in the labyrinth of the blockchain? Or will one day, when the blockchain disappears, Bitcoin also vanish?
To discuss this issue, it must be viewed from two perspectives: one is the 'loss of individual Bitcoin,' and the other is the 'disappearance of Bitcoin and the blockchain from the world.'
The Possibility of Blockchain Disappearance
The foundation of Bitcoin is blockchain technology. Blockchain is a technology that encrypts transaction data and records it in a chain-like manner, with its greatest feature being decentralization.
In simple terms, Bitcoin does not rely on specific administrators or servers, but instead disperses data across computers around the world, making it difficult to tamper with or lose data. Even if some computers stop operating, as long as other computers are still functioning, the entire system can continue to operate normally.
For example, one of the biggest threats to the Bitcoin network currently is a 51% attack.
As long as one controls the computing power of more than half of the miners (those responsible for verifying Bitcoin transactions), past transaction records can be tampered with. However, a 51% attack requires massive computing power, making it very difficult to execute in practice.
It is not entirely impossible for the blockchain to disappear, but it would be more difficult than a 51% attack:
Global Network Outage:
The operation of the blockchain relies on the network. If a global network outage occurs, the operation of the blockchain will be affected. Just like in the movie (Blade Runner 2049), where a global blackout erased all digital data, the blockchain could also disappear as a result.
All Nodes Closed:
The blockchain is maintained and supported by numerous nodes (such as computers or devices), so when all nodes are closed, the blockchain cannot be updated or operated.
However, due to the countless independent nodes operating globally, the probability of this situation occurring is extremely low.
And even if the verification nodes close, it only means that the blockchain is no longer updating and does not mean it will 'disappear' from this world forever. Even a hundred years after human extinction, as long as new humans can restart node verification, the blockchain can 'come back to life.'
The Possibility of Bitcoin Disappearing
Since Bitcoin is recorded on the blockchain, as long as the blockchain does not disappear, Bitcoin will not disappear either.
Although Bitcoin itself has high security, the following risks may still exist:
Lost Private Key:
If the private key of a Bitcoin wallet is lost, Bitcoin can no longer be used. The private key is crucial information that proves Bitcoin ownership and must be kept secure. Once the private key is lost, Bitcoin can never be recovered. Therefore, unless the access rights of the private key are arranged to be transferred to a designated heir during one's lifetime, or directly announced like Saylor to permanently destroy the private key, the Bitcoin in the wallet will never be able to be transferred or withdrawn again.
Exchange and Hacker Risks:
Storing Bitcoin on exchanges may face the risk of the exchange being hacked or going bankrupt. There have been past incidents where exchanges were hacked, leading to users' Bitcoin being stolen.
Threat of Quantum Computers:
The future development of quantum computers may pose a threat to Bitcoin's encryption technology, but for now, this is still a distant possibility.
Government Regulation:
There is still uncertainty in government regulatory policies regarding cryptocurrencies, and in some extreme cases, Bitcoin could be banned due to regulatory prohibitions.
In other words, as long as the Bitcoin network continues to operate, there are enough nodes to maintain its security, and there are people willing to trade and use it, Bitcoin as a digital asset will not disappear.
However, the loss of the private key and the act of 'destroying the private key' will continuously reduce the actual circulating supply of Bitcoin, which is an important mechanism in Bitcoin's initial design to simulate the scarcity of gold and is a key reason many analysts believe Bitcoin may continue to rise in the future.
References:
cryptorank, cointelegraph
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