Simply put
- The judge determined that Mr. Prime’s inconsistent statements and delays hindered his claim under laches.
- Initially, Prime asserted he held very little cryptocurrency but later stated he possessed 3,443 Bitcoins.
- The hard drive was destroyed after authorities found no evidence of the digital assets during a search.
A federal appeals court has dismissed a Florida man’s claim to recover $354 million worth of Bitcoin he said was lost when authorities disposed of a hard drive during his 2019 arrest related to forgery and identity theft.
In a ruling published on Tuesday, the 11th Circuit supported a lower court’s denial of Michael Prime’s property restitution request, noting that he waited too long to file his claim, which delayed the government’s ability to return the destroyed hard drive.
“For years, Prime insisted he had no significant amount of Bitcoin, and when he sought to reclaim his lost assets post-prison, Bitcoin wasn’t mentioned,” stated the circuit judges.
They also noted that it was “even later” when Prime claimed to be “the king of Bitcoin.”
The court observed that Prime consistently informed investigators, probation officers, and the sentencing judge that he owned little to no cryptocurrencies, which contradicted his later assertions about owning “nearly 3,443 bitcoins.”
Federal agents relied on his initial claims to cease the search for Bitcoin, leading to the destruction of the seized devices, including the orange hard drive central to the case.
Prime, sentenced to over five years in prison in 2020 for various offenses, asserted after his release that the hard drive contained encryption keys for his missing Bitcoin.
He filed a motion under Rule 41(g), which allows defendants to seek the return of seized items post-lawsuit. However, a district court dismissed this in 2024, ruling that the equipment was “properly destroyed” and that Mr. Prime’s long-standing denials rendered his claims untimely.
The 11th Circuit echoed this conclusion, stating that Prime’s “inexcusable delay” “disadvantaged the government,” and noted that compensation would have been unjust “even if Bitcoin existed.”
Lost Coin
Bitcoin itself isn’t stored on a hard drive. It exists on the blockchain, a public ledger shared across thousands of computers. What’s stored on a hard drive is typically a private key or wallet file, which grants access to Bitcoin linked to an address.
Without these keys, your Bitcoins may still exist, but accessing them becomes nearly impossible since ownership can neither be verified nor transferred.
“If you lose a coin, it just makes someone else’s coin worth a little bit more. Think of it as a donation to everyone,” remarked Bitcoin’s pseudonymous creator, Satoshi Nakamoto, back in 2010.
According to a 2025 report, Bitcoin-only financial institution River Financial estimates that between 2.3 million and 4 million BTC—roughly 11% to 18% of the total supply—may be permanently lost.
About 3.8 million BTC are associated with wallets inactive for over a decade, and around 19.8 million coins have been mined out of a maximum cap of 21 million coins. River Financial suggests that the effective circulating supply is probably between 15.8 million and 17.5 million BTC.
