Stefan Thomas, a German-born programmer living in San Francisco, has two guesses left to figure out a password that is worth, as of this week, about $220 million.
The password will let him unlock a small hard drive, known as an IronKey, which contains the private keys to a digital wallet that holds 7,002 Bitcoin. While the price of Bitcoin dropped sharply on Monday, it is still up more than 50 percent from just a month ago, when it passed its previous all-time high of around $20,000.
The problem is that Mr. Thomas years ago lost the paper where he wrote down the password for his IronKey, which gives users 10 guesses before it seizes up and encrypts its contents forever. He has since tried eight of his most commonly used password formulations — to no avail.
But the cryptocurrency’s unusual nature has also meant that many people are locked out of their Bitcoin fortunes as a result of lost or forgotten keys. They have been forced to watch, helpless, as the price has risen and fallen sharply, unable to cash in on their digital wealth.
Of the existing 18.5 million Bitcoin, around 20 percent — currently worth around $140 billion — appear to be in lost or otherwise stranded wallets, according to the cryptocurrency data firm Chainalysis. Wallet Recovery Services, a business that helps find lost digital keys, said it had gotten 70 requests a day from people who wanted help recovering their riches, three times the number of a month ago.
But Bitcoin has no company to provide or store passwords. The virtual currency’s creator, a shadowy figure known as Satoshi Nakamoto, has said Bitcoin’s central idea was to allow anyone in the world to open a digital bank account and hold the money in a way that no government could prevent or regulate.
Alex Stamos, who is now professor at the Stanford Internet Observatory, tweeted Mr Thomas: “Um, for $220m in locked-up Bitcoin, you don’t make 10 password guesses but take it to professionals to buy 20 IronKeys and spend six months finding a side channel or uncapping.
“I’ll make it happen for 10%.
“Call me.”
Um, for $220M in locked-up Bitcoin, you don’t make 10 password guesses but take it to professionals to buy 20 IronKeys and spend six months finding a side-channel or uncapping.
I’ll make it happen for 10%. Call me. https://t.co/dTumE8Cw65
— Alex Stamos (@alexstamos) January 12, 2021
Mr Thomas, who was born in Germany but lives in San Francisco, was given 7,002 bitcoins as payment for making a video explaining how cryptocurrency works more than a decade ago.
At the time, they were worth a few dollars each.
He stored them in an IronKey digital wallet on a hard drive.