Archive › Compare › Outcome by Stress Condition
Part of the CustodyStress archive of observed Bitcoin custody incidents
Bitcoin Custody Outcomes by Stress Condition
Which custody failure conditions most frequently lead to permanent loss — and which produce constrained or survivable outcomes? This comparison shows outcome distributions across the archive's documented stress conditions, sorted by blocked rate.
The CustodyStress assessment models seven stress scenarios — death or absence, device loss, cognitive failure, coercion, legal seizure, forced relocation, and time-based degradation. The archive's stress condition classification corresponds to these scenarios. A custody system that survives one stress condition may fail under a different one — the same hardware wallet that survives device loss may fail under owner death if no recovery documentation exists.
Blocked % is calculated from determinate cases only. Indeterminate cases are excluded. The archive documents failures — stress conditions with higher case counts reflect higher public reporting frequency, not necessarily higher real-world frequency.
Outcome distributions by stress condition
Blocked
Constrained
Survived
90% blocked
0% constrained
10% survived
Most common custody type: Software wallet
81% blocked
1% constrained
18% survived
Most common custody type: Hardware wallet (single key)
77% blocked
0% constrained
23% survived
Most common custody type: Software wallet
64% blocked
36% constrained
0% survived
Most common custody type: Exchange custody
61% blocked
36% constrained
4% survived
Most common custody type: Exchange custody
60% blocked
5% constrained
35% survived
Most common custody type: Software wallet
56% blocked
6% constrained
38% survived
Most common custody type: Software wallet
52% blocked
8% constrained
40% survived
Most common custody type: Software wallet
What the distributions reveal
Seed phrase unavailable has the highest blocked rate of any stress condition in the archive at 90% of determinate cases (157 total cases). This condition represents the purest knowledge-dependency failure — access that exists nowhere outside of memory.
Credential loss conditions — missing passphrase, missing seed phrase — produce the highest blocked rates in the archive because they have no institutional recovery path. There is no authority to contact, no process to initiate, no claim to file. When the cryptographic secret is gone, the Bitcoin on that address is permanently inaccessible. No legal process, no technical service, and no amount of professional intervention can substitute for the missing credential.
Owner death and incapacity produce high blocked rates but also meaningful constrained rates — reflecting cases where partial recovery was achieved through estate processes, technical assistance, or partial documentation. The same stress condition produces different outcomes depending on what documentation and coordination arrangements existed before the stress event occurred.
Vendor lockout and exchange failure cases produce lower blocked rates than self-custody credential failures, because institutional processes — bankruptcy claims, account recovery, regulatory intervention — provide paths toward eventual partial resolution. Constrained outcomes dominate: access is delayed, limited, or partial, rather than permanently closed. The tradeoff is time and certainty: exchange custody survivors often wait years and receive less than they held.
Forgotten or unavailable passphrase has the lowest blocked rate at 52%. The lower rate reflects the structural characteristics of these cases — 226 cases in the archive — where alternative recovery paths or institutional resolution mechanisms were more often available.
Physical coercion has a distinct outcome profile — a high survival rate that reflects the attacker obtaining what they sought, which counts as access surviving from the holder's perspective in archive classification. Coercion cases where the holder resists or the attacker fails to obtain full access are more likely to be constrained or blocked.
Stress conditions and the assessment model
The CustodyStress assessment evaluates a declared custody setup against each of these stress conditions and models a survivability outcome. The archive data here shows what outcomes were documented in actual incidents — the assessment shows what a specific declared setup would likely produce under each condition. The two are complementary: the archive describes what happened; the assessment describes what would happen to a particular arrangement.
Figures describe observed outcome distributions within documented cases in this archive only. The archive is not exhaustive.
Bitcoin Custody Incident Archive — CustodyStress · custodystress.com/cases · 895 documented incidents
Outcome terms
Survived
Access remained possible under the reported conditions.
Constrained
Access remained possible, but only with delay, dependence, or significant difficulty.
Blocked
Access was not possible under the reported conditions.
Indeterminate
There was not enough information to determine the outcome.
Assessment terms
Survivability
The degree to which a custody system maintains the possibility of authorized recovery under stress.
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?
Inclusion requirements
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.
In scope
- 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
Out of scope
- 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
Source and verification
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.
Translate