Author: Yohan Yun, CoinTelegraph; Translated by: Tao Zhu, Jinse Finance
From the lost millions in hard drives from landfills to the missing founders, the world of cryptocurrency is rife with legends of loss and deceit.
These unforgettable stories give us a glimpse into the unexpected traps of Bitcoin and cryptocurrency, and the lengths people will go to restore their hard-earned wealth.
Hard drives and lost Bitcoins in the landfill
Deep within a landfill in Newport, the value of a Bitcoin ghost continues to grow, lingering among the abandoned refuse for over a decade.
In 2013, IT engineer James Howells accidentally threw a hard drive into this wasteland. The device contained 8,000 Bitcoins, worth $1 million at the time, but now worth over $500 million.
Searching for a hard drive in a landfill containing 110,000 tons of garbage is like finding a needle in a haystack. Source: Bakhrom Tursunov
Howells had planned multiple expeditions to unearth his buried digital treasure. But each expedition met with resolute opposition from the guardian of this technological treasure—the local council.
The landfill is buried under about 110,000 tons of garbage, becoming the grave for Howells' Bitcoins—though lost, their value is immeasurable.
Howells has sued the Newport City Council for £495 million ($643 million).
His case will be heard on December 3, which will determine whether the search for the Bitcoin ghost in the Newport landfill should begin or let this desolate land linger forever.
Zombie Bitcoins in the immutable ledger
Like Howells' abandoned wealth, every lost Bitcoin tells a story—forgotten passwords hastily scribbled on scraps of paper, wallets ruined by wind and rain, investors taking their crypto secrets to the grave.
According to Glassnode, it is estimated that 1.5 million BTC are 'likely' lost forever.
The Bitcoin believed to be lost is awakening. Source: Glassnode
These dormant tokens occasionally awaken. Tokens that have been dormant for over a decade quietly flow into exchanges, allowing those anonymous millionaires to profit from their patience.
But some tokens, no matter how long they wait, will never return.
Bitcoin watchers frequently visit Satoshi's wallet, reportedly containing over 1 million BTC, in search of any signs of life from the mysterious Bitcoin creator.
But some tokens are best left untouched.
As Satoshi said, 'Lost tokens only make the others' tokens slightly more valuable. Consider it a donation to everyone.'
Rumors about USDT
Tether's influence continues to grow, with its stablecoin USDT now boasting a market cap exceeding $120 billion.
But beneath this calm surface of stablecoins, rumors swirl like fog over a graveyard. Rumors tell stories of missing reserves, dark trades, and regulatory agencies circling like vultures.
From time to time, as if prompted by an invisible hand, rumors suggest that Tether is not what it seems. Investigations quietly unfold in the corners of the internet, leaving investors and traders shivering.
The latest incident occurred on October 25, when the Wall Street Journal exclusively reported that U.S. federal agencies were conducting a criminal investigation into Tether, focusing on third-party illegal use of USDT for money laundering.
Tether CEO Paolo Ardoino dismissed the report as 'a cliché.'
Source: Paolo Ardoino
The fear is palpable: if Tether were to collapse, it could drag the entire industry into the abyss. The market crash triggered by a stablecoin failure remains a fresh and painful memory for investors, and the prospect of reliving that nightmare can be disorienting.
When Bitcoin soared to new all-time highs, the community gathered on forums and social media to recount the latest panic.
"Have you heard? Tether may be under investigation again!" they say, their voices filled with both excitement and fear.
Fear of Tether will dissipate as Bitcoin cools, but neither will completely disappear.
QuadrigaCX founder missing
As the young CEO of QuadrigaCX (once Canada's largest cryptocurrency exchange), Gerald Cotten managed millions in digital assets.
But in December 2018, his life abruptly ended, and with it, the keys to over $190 million in cryptocurrency were lost.
Cotten's cause of death was both mysterious and sudden. The 30-year-old CEO reportedly died in India while traveling ostensibly to open an orphanage, due to complications from Crohn's disease.
The truth was only revealed after his death: Cotten alone controlled access to the QuadrigaCX crypto wallets. Not only were the funds inaccessible, but the investigation also began to unveil a web of mismanagement.
The court-appointed overseer Ernst & Young, responsible for supervising the QuadrigaCX bankruptcy case, discovered six wallets used to store Bitcoin, but five of those wallets had remained empty for months prior to Cotten's death.
Only a small amount of Bitcoin remains in the remaining wallets.
Source: Michael Patryn, ZachXBT
Further investigation revealed that a large amount of cryptocurrency had been transferred from the platform to competing exchanges, moving into personal accounts controlled by Cotten. There are suspicions that these funds were used to finance Cotten's lavish lifestyle and possibly for trading on other exchanges.
To this day, some still believe that Cotten faked his death and fled with the funds.
The disappearance of the crypto queen
Ruja Ignatova, also known as the 'Crypto Queen,' is the infamous founder of OneCoin, a cryptocurrency later revealed to be a multi-billion dollar Ponzi scheme.
Ignatova disappeared from public view in 2017 as multiple countries intensified investigations into OneCoin. Her current status—whether alive or dead—is unknown.
OneCoin was marketed as a revolutionary digital currency that could rival Bitcoin, promising huge returns for investors. However, it lacked a real blockchain and was essentially selling worthless tokens. It's estimated that Ignatova and her accomplices are accused of defrauding investors of approximately $4 billion.
After her disappearance, various theories about Ignatova's whereabouts surfaced. Some believe she may have acquired a new identity with the help of complex forgery and cosmetic surgery, possibly living a lavish life in a secret location.
FBI wanted list, Ignatova is in the middle of the bottom row. Source: Federal Bureau of Investigation
Others speculate that she may have died due to dangerous criminal ties potentially involved in the OneCoin scheme.
In 2022, Ignatova was placed on the FBI's Ten Most Wanted Fugitives list, with charges against her including telecommunications fraud, securities fraud, and money laundering.
There is no conclusive evidence to confirm her identity or location.
Cryptocurrency exchanges fall into darkness
In cryptocurrency trading, fortunes can be made in the blink of an eye.
Losses do not necessarily occur due to market crashes or sudden regulatory crackdowns, but due to something more unpredictable and terrifying: major exchanges suddenly going offline at critical moments.
In January 2018, cryptocurrency exchange Kraken's expected two-hour upgrade turned into a terrifying 48-hour outage.
Meanwhile, in March 2021, Binance faced its own nightmare. Trading activity surged, and an unprecedented frenzy swept the exchange. Binance fell into outages, trading became clogged, and hope disappeared as swiftly as the numbers on the trading board.
These outages are not isolated incidents and are not limited to these examples or exchanges.
Blockchain networks like Solana have also experienced their own downtime.
However, as the industry matures, such incidents are becoming increasingly rare. No one can predict when or where the next outage will occur. For a trader who believes they have finally found a 1,000x memecoin, a single outage could completely change their fate.
