Part of the CustodyStress archive of observed Bitcoin custody incidents

Blocked Rate by Structural Dependency

Which structural dependencies, when they fail, most often produce blocked outcomes — cases where no recovery path was documented? This comparison ranks the 13 dependency types in the archive by blocked rate among determinate cases.

A structural dependency is any component a custody system relies on to function. Dependencies become failure surfaces when the components they rely on become unavailable under stress. Not all dependency failures produce the same outcomes — some consistently produce blocked access, others produce constrained or delayed access that eventually resolves.

Blocked rate is calculated from determinate cases only (blocked + constrained + survives). Indeterminate cases are excluded. A case may involve multiple dependencies — case counts are not mutually exclusive. Cases are included only where the dependency was documented as contributing to the failure.

Dependencies ranked by blocked rate

Dependency	Cases	Blocked %	Common stress
Key Colocation Multiple keys or seed copies stored together.	22	100%	Seed phrase unavailable
Geographic Access Constraint Geographic presence was required and unavailable.	36	81%	Coercion
Single-Person Knowledge Only one person understood the arrangement.	596	80%	Passphrase unavailable
Device-Dependent Access Recovery required a specific device with no independent path.	549	74%	Passphrase unavailable
Undocumented Recovery Procedure No written procedure existed to guide recovery.	546	73%	Passphrase unavailable
Recovery Materials Colocated Backup materials shared a physical location.	17	69%	Coercion
Passphrase Dependency Recovery required a BIP39 or encryption passphrase.	414	68%	Passphrase unavailable
Institutional Cooperation Required Recovery required an institution to cooperate.	198	60%	Vendor lockout
Legal Authority Required Formal legal standing was required before access.	59	58%	Vendor lockout
Shared Service Dependency Multiple paths converged on the same vendor.	170	57%	Vendor lockout
Time-Sensitive Sequencing Steps had to occur within a closing time window.	31	36%	Vendor lockout

Sorted by blocked % descending. Distribution bar shows blocked (dark red) / constrained (amber) / survived (green). Indeterminate cases excluded from blocked %.

What the rankings reveal

Key Colocation has the highest blocked rate in the archive at 100% of determinate cases — 22 total cases. Multiple keys or seed copies stored together. When this dependency fails, the failure is rarely recoverable through alternative paths.

Time-Sensitive Sequencing has the lowest blocked rate at 36% — meaning cases in this category more often produce constrained or surviving outcomes despite the dependency failure. Steps had to occur within a closing time window. The lower blocked rate reflects the presence of alternative recovery paths or institutional processes that provide partial resolution.

Dependencies involving human knowledge — single-person knowledge, undocumented procedure, no designated recovery person — appear consistently near the top of this ranking. When knowledge is the dependency, its loss is irreversible. No recovery service, no professional intervention, and no legal process can reconstruct information that only one person held and never documented. This category of dependency failure is the most common in the archive and the most likely to produce permanent loss.

Institutional dependencies — institutional cooperation required, legal authority required — tend to produce constrained rather than permanently blocked outcomes, because institutional processes, even when slow and uncertain, provide some path toward eventual resolution. Exchange bankruptcy claims, probate proceedings, and regulatory processes are slow, but they are not permanently closed. This is structurally different from self-custody knowledge failures, where no process exists to substitute for the missing information.

The authority–access gap dependency appears in cases where legal authority and operational access are structurally separated — probate establishes an heir's entitlement, but the Bitcoin network does not recognise that entitlement. These cases have high blocked rates because the legal process, when completed, still does not produce the private key access required for recovery. The process closes but the access problem remains open.

Dependency hub Outcome by documentation Archive statistics

This archive documents cases where a legitimate owner, heir, or authorized party encountered barriers accessing or recovering Bitcoin due to a failure in the custody arrangement. The central question for inclusion is: did the custody structure fail a legitimate access or recovery attempt?

A case must satisfy all three of the following to be included:

Legitimate access attempt. The person attempting to access or recover the Bitcoin was the owner, a designated heir, an executor, a legal authority, or another party with a legitimate claim — not a thief, attacker, or unauthorized third party.
Custody structure failure. The failure was caused by a property of the custody arrangement — missing credentials, structural dependencies, documentation gaps, knowledge concentration, legal barriers, or institutional constraints — not market conditions, individual-level fraud or theft, or protocol-level issues. Platform-level failures that block legitimate user access are in scope regardless of their cause.
Documentable outcome or access constraint. The case must have a stated or inferable outcome: access blocked, access constrained, access delayed, or access eventually achieved through a recovery path. Cases with entirely unknown outcomes are included only where the structural failure is documented and the constraint is unambiguous.

Owner death or incapacity — Bitcoin held in self-custody that becomes inaccessible to heirs or designated parties because credentials, documentation, or operational knowledge were not transferred
Passphrase loss — BIP39 passphrase forgotten or unavailable, blocking access to a funded wallet even where the seed phrase is present
Seed phrase or wallet backup unavailable — no independent recovery path existed or the backup was destroyed, lost, or never created
Device loss without independent backup — hardware wallet, phone, or computer lost or destroyed with no recovery path outside the device
Documentation absent or ambiguous — heirs or executors cannot determine that Bitcoin exists, which wallet holds it, or how to access it
Knowledge concentration — only one person knew the procedure, passphrase, or access method; that person is dead, incapacitated, or unreachable
Multisig quorum failure — a threshold signature arrangement cannot be completed because signers are unavailable, uncooperative, incapacitated, or have lost their keys
Legal authority / access mismatch — a court order, probate ruling, or power of attorney establishes legal entitlement but provides no technical path to access
Institutional custody barrier — exchange or platform hacks, insolvency, regulatory seizure, or operational failure that caused a access constraint or failure for legitimate users, whether temporary, prolonged, or permanent. The failure of the custodian to remain available or solvent is itself the in-scope event.
Forced relocation or geographic constraint — physical access to a device or location required for recovery is blocked by displacement, border restrictions, or political circumstances
Coercion — the holder was compelled under threat to transfer Bitcoin or disclose credentials during an access event
Hidden asset discovery — heirs or executors locate a wallet or account but cannot access it due to missing credentials or operational knowledge

Market losses, investment losses, yield scheme losses, or Ponzi scheme losses
Hacks or theft targeting an individual's personal security (phishing, SIM swap, social engineering, malware) where the custody architecture itself did not fail
Unauthorized transfers where the holder's custody system was not the cause of the failure
Ordinary transaction mistakes — wrong-address sends, fee errors, mistaken amounts
Protocol-level failures — cryptographic vulnerabilities, consensus bugs, firmware integrity failures
Deliberate burns or tribute burns
Cases where the stated loss is unverifiable and no structural custody failure is described

Cases are drawn from public sources including forum posts, news reporting, court documents, academic research, and direct submissions. Each case is reviewed against the inclusion criteria above before publication. Source material is retained and available on request for documented cases.

The archive is observational and descriptive. It does not attempt to document all Bitcoin custody failures — only those meeting the criteria above with sufficient documentation to describe the structural failure and its outcome.