Coinbase Reveals $3.4B in Ethereum Permanently Lost as Supply Shrinks

Coinbase has reported that approximately 913,111 ETH, worth $3.43 billion, has been permanently lost due to user errors and technical glitches, accounting for 0.76% of Ethereum's total supply. This irreversible loss highlights the growing 'crypto graveyard' of digital assets that can no longer be recovered. Additionally, Ethereum's fee-burning mechanism has further reduced the circulating supply by destroying 5.3 million ETH, valued at $23.4 billion, intensifying the asset's scarcity. As of July 2025, these factors continue to shape Ethereum's economic landscape, reinforcing its deflationary properties.

Coinbase Reports $3.4B in Ethereum Lost Forever Amid Growing Crypto Graveyard

Ethereum's circulating supply is shrinking as user errors and technical glitches permanently remove coins from availability. Coinbase estimates 913,111 ETH—worth $3.43 billion—are now irrecoverable due to mistaken transactions and contract bugs. This figure represents 0.76% of ETH's total supply.

The network's fee-burning mechanism exacerbates the scarcity, having destroyed 5.3 million ETH ($23.4 billion value) since implementation. Combined with lost coins, 5% of all issued ETH is now effectively out of circulation—a 44% increase in lost assets since March 2023.

Coinbase's Conor Grogan notes these conservative estimates exclude forgotten private keys and dormant genesis wallets. Market observers view the trend as underscoring Ethereum's deflationary characteristics, contrasting with traditional fiat systems where central banks can replenish supplies.

Ark Invest Trims Coinbase Holdings, Shifts $175M to Bitmine

Cathie Wood's Ark Invest continues its strategic portfolio rebalancing, selling 219,986 Coinbase shares across three ETFs this week. The MOVE follows a pattern of weekly COIN divestments throughout July, totaling over 250,000 shares sold since the start of the month.

Despite being among Coinbase's top 10 holders, Ark's latest reduction comes just days after COIN reached its all-time high of $413.63 on July 18. The cryptocurrency exchange's stock shows modest volatility, dipping 1.47% in regular trading before gaining 0.3% in pre-market activity.

The capital rotation into Bitmine signals growing institutional confidence in cryptocurrency infrastructure plays. 'When the facts change, I change my mind,' Wood appears to be channeling Keynes' famous maxim through these calculated adjustments to Ark's disruptive technology portfolio.

SpaceX Moves $152M Bitcoin After Three-Year Dormancy

Elon Musk's aerospace company SpaceX has transferred 1,308.45 BTC ($152.85 million) after three years of wallet inactivity. Blockchain data reveals the transaction was likely an internal reorganization, with no net change in holdings. The funds remain under Coinbase Prime custody, maintaining SpaceX's total Bitcoin position at 6,977 BTC.

Transaction fees totaled just $29, showcasing Bitcoin's efficiency for large-value transfers. The movement follows a smaller test transaction to Coinbase Prime earlier this month. SpaceX originally accumulated the bitcoin between 2020-2021, when its holdings briefly surpassed $1.6 billion during the bull market.

Market observers note the timing coincides with Bitcoin's recovery above $58,000, though no sell pressure materialized. "This appears to be routine wallet maintenance rather than a strategic shift," said a blockchain analyst familiar with institutional crypto movements. SpaceX continues to hold approximately $818 million in Bitcoin at current valuations.

Citadel Urges SEC to Proceed Cautiously on Tokenized Stocks

Citadel has cautioned the SEC against rushing the approval of tokenized stocks, warning that premature action could create investor confusion and unfairly benefit certain exchanges. The trading firm's letter to the SEC’s crypto Task Force emphasized the need for a structured rulemaking process, arguing that shortcuts might lead to regulatory loopholes.

The push comes as SEC Chairman Paul Atkins considers revising rules to accommodate crypto-based securities. Citadel insists that tokenized products should succeed based on merit, not regulatory ambiguity. The firm also raised concerns that tokenization could further weaken the IPO market by providing private companies with alternative fundraising avenues.

Tokenized securities, which represent traditional assets on blockchain networks, have gained traction on platforms like Coinbase and Robinhood due to their fractional ownership model. However, Citadel contends that without clear guidelines, these products risk destabilizing existing financial markets.

JPMorgan to Offer Crypto-Backed Loans in Institutional Adoption Milestone

JPMorgan Chase is preparing to accept Bitcoin and ethereum as loan collateral by 2025, marking a strategic pivot for the Wall Street giant. The bank currently permits borrowing against crypto ETFs like BlackRock's iShares Bitcoin Trust, but this expansion into direct crypto collateral signals deeper institutional integration.

The move coincides with improved U.S. regulatory clarity for digital assets. Notably, CEO Jamie Dimon—who once called Bitcoin "worthless"—now accommodates client demand while maintaining JPMorgan's hands-off balance sheet approach. Third-party custodians such as Coinbase will likely safeguard the crypto collateral, mitigating default risks.

This development reflects a broader banking sector trend: traditional finance is building bridges to crypto markets through regulated, institutional-grade products. The collateralization of major cryptocurrencies like BTC and ETH demonstrates their evolving role as financial instruments beyond speculative assets.

SpaceX Moves 1,308 BTC After Three Years of Inactivity

SpaceX has transferred 1,308 Bitcoin (BTC) after a three-year dormancy, marking its first significant movement of the cryptocurrency since initial accumulation. The transaction followed a minuscule test transfer of 0.000248 BTC (under $30) to Coinbase Prime, likely to verify wallet integrity before executing the full transfer. The entire sum was moved in a single transaction with a negligible fee of $29—far below typical costs for such a high-value transfer.

The destination address remains inactive, suggesting the move was part of a cold storage reorganization or security upgrade rather than a liquidation. Blockchain records indicate SpaceX received multiple large BTC deposits from Coinbase between 2020 and 2021, totaling over 6,900 BTC at peak valuations. Current holdings, still custodied with Coinbase Prime, are valued at approximately $818 million—a sharp decline from their $1.6 billion worth during Bitcoin’s 2021 bull run.

Elon Musk first confirmed SpaceX’s Bitcoin holdings in 2021 without disclosing specifics. The company’s recent activity underscores institutional players’ strategic management of crypto reserves amid market volatility.