Part of the CustodyStress archive of observed Bitcoin custody incidents
CS-00854
Passphrase unavailable — software wallet (2020)
BlockedCase description
Stefan Thomas, a Bitcoin developer who held 7,002 BTC on an encrypted IronKey drive, was reported in 2021 to have had only two remaining password attempts left having forgotten his password. The IronKey permanently encrypts its contents after 10 failed attempts. The case became widely known as a symbol of irrecoverable passphrase loss.
Custody context
| Stress condition | Passphrase unavailable |
| Custody system | Mobile or software wallet |
| Outcome | Blocked |
| Documentation | Unknown |
| Year observed | 2020 |
| Country | United Kingdom |
Structural dependencies observed
What this illustrates
The seed phrase was there, but the passphrase that unlocked it was gone. Both are required. Access was not recoverable.
Outcome interpretation
Access was not possible under the reported conditions.
Source
Publicly Reported
Evidence type
News article
Evidence link
Related cases involving passphrase unavailable
217 cases involve passphrase unavailable
572 cases involve mobile or software wallet
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This archive documents observed custody survivability failures. It does not attempt to document all Bitcoin losses or security incidents.
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Framework references
Where Bitcoin Custody Intersects Legal and Fiduciary Authority
Where custody creates gaps in estate planning, fiduciary duty, and professional responsibility.
Professional Scope Boundary Matrix
What each professional or product covers, what they do not, and where gaps form between them.
The Independent Assessment Layer in Bitcoin Custody
How independent diagnostic layers emerge when multiple parties depend on shared infrastructure.
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