August 29, 2025 – El Salvador has taken a dramatic step to safeguard its Bitcoin treasury. On August 29, the government announced it had redistributed its entire Bitcoin reserve worth about $678 million—across 14 separate wallet addresses. The move is designed to reduce exposure to future threats from quantum computing, a technology that could one day compromise Bitcoin’s cryptographic security.
Key Takeaways
El Salvador moved ~$678M in Bitcoin into 14 wallets, each capped at 500 BTC.
The goal is to reduce quantum computing risks tied to reused public keys.
Some call it visionary, while critics say quantum attacks are decades away.
A new public dashboard will track the wallets; global adoption may follow.
Why El Salvador Made the Move
The country, led by President Nayib Bukele, holds roughly 6,280 BTC. Previously, most of it sat in a single wallet that had been reused for multiple transactions. Officials explained this setup increased risk, as reusing addresses exposes public keys, which quantum computers might one day exploit.
By spreading funds into fresh wallets capped at 500 BTC each, El Salvador ensures those public keys remain hidden until the coins are spent. The nation’s Bitcoin Office stated:
“Limiting funds in each address reduces exposure to quantum threats because an unused Bitcoin address with hashed public keys remains protected.”
Quantum Threat – Far Off, Still Serious
Quantum computing is still in early stages, but in theory, Shor’s algorithm could break public-key cryptography. Experts say practical attacks remain decades away. Yet El Salvador is treating the risk as urgent, setting a precedent for sovereign Bitcoin management.
Some, like MicroStrategy’s Michael Saylor, argue Bitcoin’s protocol can adapt before quantum threats become real. Others praise El Salvador’s proactive stance as an example of long-term thinking in digital asset security.
Transparency and Market Context
The move addresses another issue: transparency. Keeping funds in a single wallet made it easy to track but more vulnerable. Now, the Bitcoin Office has launched a public dashboard to monitor all addresses, balancing visibility with better protection.
At current prices of around $108,000 per BTC, El Salvador’s holdings have appreciated significantly since its first purchases in 2021. While the IMF continues to criticize the Bitcoin strategy, domestically the reserve remains a source of pride.
A Global Signal
Analysts say this redistribution may shape how other nations manage crypto reserves. Countries like Bhutan already hold BTC, and others are rumored to follow. If sovereign treasuries begin adopting similar defensive strategies, El Salvador’s move could influence global standards for digital asset custody.
For critics, the decision may seem premature. But for supporters, it signals a new era: one where sovereign wealth managers must think not just about price volatility, but also about technologies of the future.
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