Is there a mechanism to handle stale bitcoins? Possible Duplicate:
  Why doesn&#39;t Bitcoin return lost coins back into the block reward?
  What could be the consequences of many bitcoins being lost out of circulation if people lose their wallets?  




Okay, the first question has to do with stale bitcoins.  Say people lose their private keys.
Over time it just keeps building, and a large portion of the 21mm bitcoins are immobilized.
What happens?

The same scenario can occur for a different reason, say people start putting bitcoins in their
IRAs and there millions of bitcoins held immobile.  Also, how do I know that in 20 years they still will be good.  Maybe the network truncates the transaction log and my part falls off.
If coins are lost, they are gone forever. This only hurts the person who lost the coins... and in fact it makes the rest of the coins more scarce and thus more valuable long term.

Because Bitcoins are divisible down to eight (or more) decimal places, it really means there are 21,000,000 x 1,000,000 = 210,000,000,000,000 units (and this can be divided even further with changes to the code. In practice, this means that one can always have a "small enough" unit of Bitcoin to buy tiny items. 

So if X number of Bitcoins are lost, the rest simply become more valuable, and unless a coffee costs less than .000000000000001 BTC or something, there will not even be a need to alter any code. If we were using those tiny units, a convenient name would be given to them and life would be fine and dandy.