El Salvador has redistributed its Bitcoin reserves into 14 new wallet addresses as a precaution against potential quantum computing threats.
“By dividing the funds into smaller amounts, the risk of a possible quantum attack is reduced,” El Salvador’s Bitcoin Office stated in a post on X on Friday, noting that each Bitcoin (BTC) address holds up to 500 BTC.
The Bitcoin Office explained that once funds are spent from a Bitcoin address, its public keys become visible and susceptible — making it vulnerable to quantum computers if the technology advances into a significant threat in the future.
More than 6 million Bitcoins — valued at approximately $650 billion — could be at risk if quantum computers become potent enough to break elliptic curve cryptography (ECC) keys, according to quantum research company Project Eleven’s report in April.
Onchain transfers completed
El Salvador previously maintained its 6,274 Bitcoin reserve (valued at $678 million) in a single address, but blockchain data indicates those funds were moved to 14 new addresses on Friday.
Quantum concerns are minimal, for now
While El Salvador’s actions received praise from industry experts, Project Eleven noted that quantum computing remains far from being able to compromise Bitcoin. A Bitcoin private key contains 256 bits, and no quantum computer utilizing Shor’s algorithm has successfully cracked a 3-bit key to date.
Michael Saylor, the architect of Strategy’s Bitcoin strategy, remarked in June that the perceived threat of quantum computing to Bitcoin is overhyped, asserting that if it ever became a serious issue, the protocol’s core developers and hardware manufacturers would provide solutions.
“The solution is: Bitcoin network hardware upgrade, Bitcoin network software upgrade, just like [how] Microsoft, Google, the US government upgrade.”
El Salvador entangled in IMF complexities
El Salvador’s Bitcoin acquisitions have come under scrutiny after an International Monetary Fund report in July claimed that the Central American nation has not made any new Bitcoin purchases since February.
Related: El Salvador’s Bukele responds as $1B Bitcoin holdings bet increases on Kalshi
The nation’s Bitcoin Office has not directly commented on these allegations and continues to share updates about its Bitcoin purchases on X.
El Salvador secured a $1.4 billion funding agreement with the IMF in December 2024 in exchange for scaling back its Bitcoin initiatives, among other stipulations — although the conditions appear to be disputed between the two entities.
Magazine: 3 individuals who unexpectedly became crypto millionaires… and one who didn’t
