Half a Billion in Bitcoin, Lost in the Dump

https://www.newyorker.com/magazine/2021/12/13/half-a-billion-in-bitcoin-lost-in-the-dump

by doe88 • 5 years ago

53 97 5 years ago

This article is about someone who threw away the hard drive containing his wallet file/keys, the only copy he had of it. His wallet would be worth $500M. He wants to excavate the garbage dump to find it.

I'm just wondering what that would look like. It seems a Sisyphean task at best, like seeking a needle in a haystack. And how do you make sure you don't accidentally damage a hard drive with an excavator? What makes him think the hard drive is not already damaged because it has been driven over or just the weight of garbage crushing it? What if his hard drive went through one of those conveyor belts with a giant magnet above it to separate metals?

I'm not an expert, but if you take the cost of the excavation project (not just excavation, but also sifting!), then multiply it by the chance of success, it feels like the expected value is less than the wallet.

It's interesting to think about though. You can easily throw away a pile of cash, but never half a billion. The volume would be too big, you would notice. But a bitcoin wallet of the same street value fits on a micro SD, it could literally fall through a hole in your pocket.

CPLX4• 5 years ago

It would be trivially easy to throw away half a billion dollars like this. All you'd have to do is have a winning ticket for a $500MM lottery jackpot in your pocket and put it through the laundry.

Crypto is gambling. People have done it for millennia. You invent some system and some arbitrary rules about what’s valuable (the right domino, an ace of hearts, a jpeg of a monkey, a beanie baby) and then some people win some money and some people lose.

This guy won, and then he lost. Oh well. Just like with the lost lottery ticket no enterprise of actual value has been created or destroyed by this misfortune.

ClumsyPilot4• 5 years ago

"Crypto is gambling"

Bitcoin is 14 years old now, it's time to get used to it. There are people who hold who were born after it was invented.

Its older than some financial instruments. I am not arguing it will be successfull or that its good, but it is definately proven beyong gambling

toolz2• 5 years ago

Yes crypto is gambling. So is fiat. This seems to be where people get confused. They think just because everything is priced in fiat that fiat somehow is immune from value swings. Which it's really weird that people believe that given how much the price of things priced in USD changes so much.

Literally everything is a gamble - there's no such thing as a risk-less vehicle for maintaining your wealth. Maybe something like bitcoin is more volatile than USD today, but that is not guaranteed to hold in the future.

Crypto is superior to fiat in every property of money other than stability, but with global adoption of bitcoin I suspect even that property will be more satisfied by crypto in the not-so-distant future.

jkepler7• 5 years ago

Figures someone would mention laundering money.

i_like_waiting• 5 years ago

It's interesting to think about though. You can easily throw away a pile of cash, but never half a billion. The volume would be too big, you would notice. But a bitcoin wallet of the same street value fits on a micro SD, it could literally fall through a hole in your pocket.

It's not exactly same thing, as you obviously won't lose something like that if you already realise its value. It's more along the lines of throwing out painting from your neighbor and he becomes world best paid artist in 5 years.

Still interesting and scary to think that individual can basically "destroy" irreversibly any amount of savings by forgetting the keys/ sending it to wrong address and that can be done with 1 click.

bruce3434342• 5 years ago

Right, it wasn't exactly an analogy. But I think it's still somewhat scary how easy it is to accidentally lose as well.

jkepler7• 5 years ago

Still interesting and scary to think that individual can basically "destroy" irreversibly any amount of savings by forgetting the keys/ sending it to wrong address and that can be done with 1 click.

That's exactly why any large values of bitcoin ought to be stored in multisignature wallets, 3-of-5 offering pretty robust resilience to loosing a key or two. In that case, you need three different signatures to move any money, so no single click accidental failures. Time locking funds can also prevent user mistakes, as no one can move the coins until the lock time is reached on-chain.

JKCalhoun2• 5 years ago

Howells grabbed the unwanted hard drive and threw it into a black garbage bag.

Would never happen to me, I am a hoarder (especially of old hard drives).

BrandoElFollito• 5 years ago

The painting part incidentally happened to my partents.

They had a friend who was basically giving away his paintings but nobody wanted them (they were horrifying, Coraline-style, and actually a picture of his mind).

He even wanted to create a paining roll with similar horrors when they were painting their apparment.

He was a very good friend but the paintings were to much.

Then he died and a few years later his paintings prices hit the roof (various hundreds of thousands of euros). My parents are still glad to not have had the paintings because they were giving them nightmares :)

corobo• 5 years ago

And how do you make sure you don't accidentally damage a hard drive with an excavator? What makes him think the hard drive is not already damaged because it has been driven over or just the weight of garbage crushing it? What if his hard drive went through one of those conveyor belts with a giant magnet above it to separate metals?

Money until proven otherwise. Never underestimate the power of money on a person haha. Plenty of people out there that would eat a fair share of the excavated crap for a potential 500 milly never mind sift through it

If he's smart he'll spin the attention into something with actual value than try to actually excavate a landfill

FDSGSG3• 5 years ago

I'm just wondering what that would look like. It seems a Sisyphean task at best, like seeking a needle in a haystack. And how do you make sure you don't accidentally damage a hard drive with an excavator? What makes him think the hard drive is not already damaged because it has been driven over or just the weight of garbage crushing it? What if his hard drive went through one of those conveyor belts with a giant magnet above it to separate metals?

Sorting out all the hard drives within the proposed quantities of trash seems well within the realm of what's possible with modern waste sorting robots.

Hard drives are really sturdy, it's unlikely that the data would be unrecoverable if you were able to identify the correct hard drive remains.

dmurray• 5 years ago

Yeah, I think you could do this project for tens of millions and have a 20% chance of finding it intact, and you could argue those numbers are conservative. All assuming everything is as described in the article.

Here's an account [0] of a single diamond mine that processes 60,000 tons of material every day, of which 10,000 tons is ore that needs to be examined closely enough to find diamonds.

The article talks about excavating a 250m x 250m x 15m volume, approximately 1 million tons. Even if all of that is potential "ore" - which I doubt - that's a hundred days for the diamond mine.

The diamond miners have different economies of scale and different environmental concerns, but I think it's a good starting point.

[0] https://www.businessinsider.com/diamond-mine-siberia-russia-...

killtimeatwork• 5 years ago

Let's not forget the human factor. Presumably, an operation of this scale would require hiring help - potentially lots of it. How do you make sure that one of the workers does not just leave with the hard drive? It would require security on the level employed in gemstones mines (personal search for every employee who leaves the premises etc.) Kind of hard to set up in a bulletproof way - the potential finder could just let the relevant security people in on the profits.

FatalLogic• 5 years ago

Offer a percentage of the proceeds to the finder's team. Rationally then, they would be satisfied to give the drive to their employers, because their employers are more likely (than anyone else they'd be able to find) to recover the data from a drive that is badly damaged, and to pay them a generous bonus, as agreed.

It also incentivizes the workers to keep an eye on each other to prevent the drive being smuggled out of the site.

em3rgent0rdr• 5 years ago

"But a bitcoin wallet of the same street value fits on a micro SD, it could literally fall through a hole in your pocket."

But you can make any number of copies of the wallet.

YXNjaGVyZWdlbgo• 5 years ago

I guess Ross Hannaman still hasn't found that thumbdrive.

misja111• 5 years ago

Anonymity comes at a price.

egeozcan2• 5 years ago

We have an anonymous system, it's called cash. The price is you lose the anonymity if you store it in a bank, which something you have to do in many countries if you own too much.

You can still withdraw some and spend it anonymously.

Given, you can't buy a house anonymously with cash, but can you do that with bitcoin?

shric• 5 years ago

Cash also fairly rapidly depreciates

pjc502• 5 years ago

Note that in the UK you cannot legally buy a house anonymously with anything.

skilled2• 5 years ago

I would not want to be this person, in any shape or form. It's fascinating to think that a man's mind can become so entangled in an alternate reality in hopes of getting back something that he lost.

While it would be a wonderful success story to see him find his hard-drive, I can't even begin to imagine the levels of exhaustion and stress he has endured up to this point.

Stevvo• 5 years ago

Your comment makes me think about how sometimes people build their own mental prisons.

I've met several people who told me stories of loosing their Bitcoin; the people who get too caught up on the alternate reality are those who fail to realize they would have sold their coins anyway the first time they had a bill to pay.

DennisP• 5 years ago

I see this point made a lot, and I'm sure it's true for a lot of people, but there are also people who did in fact hold their bitcoin for a very long time.

FDSGSG3• 5 years ago

The part that must really fuck with him is that at this valuation recovering the hard drive would be an entirely realistic endeavour if he simply got the permission to do so.

flycaliguy• 5 years ago

I feel like his best bet would be to consult various religious leaders and convert this experience into a profound voyage to faith.

Then market a book & speaking tour. Quit at 3 mil and call it a day.

skilled2• 5 years ago

Hahahaha, you are probably right, too.

clavicat• 5 years ago

The abstraction of mining made concrete. When Bitcoin reaches a certain price, it will become economical to excavate the entire landfill to physically mine the trove of Bitcoin. The growing value forces the ore to surface.

marderfarker2• 5 years ago

It’s worth half a billion in theory.

nikanj• 5 years ago

It’s worth half a billion if half a million people all want to invest $1000 into bitcoin - assuming no other sellers on the market.

Ponzi schemes are wack, and you can still find people who think they too can become hundred-millionaires by putting a few hundred into bitcoin

jkepler7• 5 years ago

Except that bitcoin fits none of the definitions of a ponzi scheme, unless you think money as a technology for storing wealth is a ponzi scheme.

For example, under the gold standard (1870s until 1913), the US saw gradual price deflation, meaning people expected their money to gradually grow in purchasing power, yet (amazingly) the economy grew! Turns out deflation isn't bad, even thought it may look like a ponzi to those who don't understand it.

https://www.lynalden.com/bitcoin-ponzi-scheme/

trollied• 5 years ago

The BBC reported on this 8 years ago, when the bitcoin was worth $4m! https://www.bbc.co.uk/news/uk-wales-south-east-wales-2513428...

isoprophlex• 5 years ago

By not being allowed to excavate that landfill, he is basically making money ;)

MrPatan• 5 years ago

Maybe he can get a loan against them, like those big stone wheels some people I can't remember used as money somewhere in the world I also can't remember.

jeffwass• 5 years ago

This wss literally a plot point in HBO's Silicon Valley :

https://www.youtube.com/watch?v=GrEjaZw95kI

(Russ Hanneman searching the landfill site for a lost thumb drive with his crypto).

edmcnulty1013• 5 years ago

That's the first thing I thought of. Mike Judge is a prophet.

detaro3• 5 years ago

A "prophet" for putting something that has been reported since 2013 or so in a TV show that came out 2018?

petters• 5 years ago

No, that plot point was likely written because of this.

boopboopbadoop• 5 years ago

This story happened and was publicized first. I’d imagine Judge used it as inspiration for that episode. None-the-less, I love Mike Judge!

ChuckNorris89• 5 years ago

Silicon Valley is a underrated satire. Not a great comedy if you're not into the dry humor revolving around the SV lifestyle but I really enjoyed it.

ChrisArchitect• 5 years ago

Yeah, this whole New Yorker piece is not a new story. The James Howells story has been around for years and party inspired the Russ Hanneman plot haha

helsinkiandrew• 5 years ago

Slightly more lucrative but harder to find than the 700,000 unsold Atari game cartridges, including E.T. the Extra-Terrestrial, eventually found in a New Mexico landfill site.

https://en.wikipedia.org/wiki/Atari_video_game_burial

willis9362• 5 years ago

It's 8 AM. Do you know where your data is? Always have a plan.

I recently switched to a TrueNAS system that I back everything up to. It uploads to B2 daily with remote encryption. Keys and passwords are kept in a keepass database on my phone and computers. I've done test pulls as a fire drill. I don't have $500 M in crypto. I don't even have $5 k in crypto.

ceejayoz2• 5 years ago

It's 8 AM, do you know where your data is? Always have a plan.

Sure, but a significant portion of the problem is that's not the real question.

"It's 8 AM, do you know how important your data will be in ten years?"

koolba• 5 years ago

Make sure you can’t overwrite the remote site. It’s not a true offsite backup if the source can issue a delete or replace command.

willis9362• 5 years ago

I have immutable snapshots on B2 with a few week lifetime. It is the weakest point, but I'd have to do something very dumb and not realize it within that period. I could extend that period, but it costs more in exchange for trusting myself less.

Edit: actually I just checked and I had left the default lifecycle rules (keep all versions). The bill is still less than a dropbox personal bill for my modest usage.

ClumsyPilot4• 5 years ago

Its 8 AM. Do you know where your fire extinguisher is? How to do first aid? What to do in a flood? Earthquake? Home break-in? If your bank goes insolvent, and you are so cashless you can't even buy a meal?

Most people aren't prepared for emergencies really, and dats one is not even at the top

teekert2• 5 years ago

I think I'm better off, I wanted to start mining when people were still generating btc on their laptops, didn't get it to work. At least I have no place to go back to for that off chance that I somehow swing history the right way and persevere a little longer. Unlike this lad, who forever has this minute chance of being rich again. I think you're better off with 0 chance.

fbanon2• 5 years ago

You shouldn't feel bad about missing out. You would have sold anyway when it was worth $20. Or $50. Or $100. etc.

Like the guy who've spent 10k BTC for two Papa John's pizzas in 2010.

teekert2• 5 years ago

That's a fact. I have a wallet from 2014 where I occasionally ordered sushi or Raspberry Pi stuff (on pi-hut) from, every time the amount left after ordering something grew again and I could buy/order something else. Pretty shocking to see what I paid for the earliest RPi's and Sushi back in the day, with the current rate.

Avalaxy• 5 years ago

I was very active in cryptocurrencies between 2013 and 2014. Had around 25 BTC and I bought hundreds of ethereums in the presale. Sold them all for a minor profit after there was yet another crash and I gave up on it lol. In retrospect I would now be a multi-millionaire at age 30, rather than a working slave living in a rental apartment. Ah well. Like the sibling post said: I probably would have sold it before this point anyway, I'm not THAT diamond handed.

DonHopkins• 5 years ago

Digging through tons of garbage could be considered "Proof of Work"!

Wouldn't it be nice if the Bitcoin shills could figure out a way of proving they worked to clean up the environment, instead of destroying it.

jkepler7• 5 years ago

One could read up on how bitcoin mining is being used in the west Texas Permian Basin to help reduce flared methane gas. Or, how electric companies could mine bitcoin to provide their grids with power consumption for demand/supply load balancing, enabling them to produce more green energy that would otherwise be feasible.

One just has to be willing to look at the facts rather than repeating environmentalist characterizations of bitcoin technology as bad.

rocqua2• 5 years ago

If you have mining rigs that you use for load balancing your electric network, wouldn't you want to run them 24/7? Especially because of your upfront capital costs for buying the mining rigs.

Would be cool though if a day with little wind would make for a perfect time to do a 50% attack.

pmarreck• 5 years ago

The computer’s whirring fan began to irritate Hafina, and he decided to stop. “It wasn’t worth putting up a fight,” he remembers.

Why, yes. This time, it was. >..<

Thing is, back in that era, you could mine a few full bitcoins a night doing that.

ginger2016• 5 years ago

How can anyone verify he owned all these bitcoins?

rocqua2• 5 years ago

Seeing the bitcoin sitting still on his address is a matter of looking up the UTXO.

Confirming the address really belongs to him is probably doable by talking to the few people in the community back then.

fbanon2• 5 years ago

This is why I simply don't throw away data. It's so cheap to just store it indefinitely. I have all my personal projects, emails, instant messages going back to 2002. It's literally just a matter of copying your home directory when getting a new computer... Sure, you can get fancy with backups, cloud, and whatnot, but data hygiene 101 is just not throwing it away. I don't get why it's so hard.

nicbou• 5 years ago

It's the collection of data that I find difficult. A lot of it is locked with various cloud providers, and can only be retrieved with manual exports.

acomjean• 5 years ago

I worked building landfills. The scale house operators (who weighed the truck) had some stories about accidentally tossed things. Someone came and asked if they could look for a silver metal box. Sure, they said your not likely to find it. They insisted on looking. What’s in the box? A lot of money.

The only success was when someone got there before the trash truck and they dumped it in a certain area and wallet was recovered.

For $500 million it’s worth trying..though who knows if the drive will even be in one piece.. though landfills are pretty dry and almost nothing rots. landfill archiology.

Half a Billion in Bitcoin, Lost in the Dump

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