Bitcoin: Millionaires forget their passwords and lose access to their wealth

Stephen Thomas, a German developer living in San Francisco, has two chances to find a password worth about $220 million. The password will allow him to unlock a small hard drive, known as IronKey, which contains the private keys of a digital wallet containing 7,002 Bitcoin.


The problem is that Mr. Thomas years ago lost the paper where he wrote the password for his IronKey, which gives users 10 chances before they understand and encrypt its content forever. He has since tried eight of the most commonly used password formats – to no avail.


I’m going to lie in bed and think about it,” said Thomas. “Then I would go to the computer with a new strategy, and it would not work and I would be desperate again.”


Bitcoin, which has been in an extraordinary and volatile, has made many of its holders very rich in a short time, even when the pandemic devastated the global economy. But the unusual nature of cryptocurrency also meant that many people are locked out of their Bitcoin assets as a result of lost or forgotten passwords.


They were forced to watch, helpless, as the price has risen and fallen sharply, unable to redeem their digital wealth.


Wallet Recovery Services, a company that helps find lost digital codes, said it had received 70 requests a day from people seeking help to recover their wealth.


Bitcoin owners who are locked out of their wallets talk about endless days and nights of frustration as they try to gain access to their property. Many have had coins since the early days of Bitcoin a decade ago, when no one had confidence they would be worth anything. “Over the years I would say I have spent hundreds of hours trying to get back into these wallets,” said Brad Yasser, a Los Angeles-based businessman who owns a few computers containing thousands of Bitcoin that he created in the early days of cryptocurrency.