Freezing Satoshi Nakamoto’s Bitcoins? BIP-361 Proposal Ignites the Community’s Most Heated “Quantum Threat” Debate
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Freezing Satoshi Nakamoto’s Bitcoins? BIP-361 Proposal Ignites the Community’s Most Heated “Quantum Threat” Debate
Rather freeze 5.6 million dormant BTC than let them fall into the hands of quantum hackers.
Navigating Web3 tides with focused insightsAuthor: Claude, TechFlow
TechFlow Introduction: On April 14, Bitcoin developer Jameson Lopp and others formally submitted BIP-361—a proposal to phase out ECDSA and Schnorr signatures in three stages, ultimately freezing all early wallets that have not migrated to quantum-resistant addresses.
The proposal affects approximately 1.7 million BTC held in P2PK addresses—including roughly 1.1 million BTC (valued at ~$74 billion) attributed to Satoshi Nakamoto—while an estimated 34% of all BTC across the network face quantum attack risks due to exposed public keys. The proposal immediately drew fierce backlash from the community; critics labeled it “authoritarian confiscation.” Lopp responded by stating he would rather freeze 5.6 million dormant BTC than allow them to fall into the hands of quantum hackers.
Renowned cypherpunk and Casa’s Chief Technology Officer Jameson Lopp, together with five other researchers, submitted a draft titled BIP-361 to the bitcoin/bips repository on GitHub on April 14. Its full title is “Post-Quantum Migration and Legacy Signature Sunset.” At its core, the proposal makes a straightforward claim: before quantum computers can break existing cryptographic algorithms, the network must proactively freeze all Bitcoin wallets relying on legacy signature schemes.
According to CoinDesk, Lopp stated in an interview that he does not currently believe these measures need immediate implementation but emphasized he is engaging in “adversarial thinking about potential future threats.” He further admitted on X: “I know people don’t like this proposal. I don’t like it either. But I wrote it because I like the alternative outcome even less.”
A Three-Stage “Sunset Plan”: From Restriction to Freeze
BIP-361 builds upon BIP-360, published in February. BIP-360 introduced a new address format called P2MR (pay-to-Merkle-root), similar to existing Taproot addresses but omitting the key-path—which is vulnerable to quantum attacks—to provide forward protection for newly minted coins. BIP-361 tackles the problem of existing coins: as of March 1, 2026, over 34% of all BTC on the network have already exposed their public keys on-chain—a figure cited directly in the BIP-361 document itself.
The proposal outlines three progressive phases:
Phase A activates approximately three years after deployment, at which point the network will prohibit sending new BTC to legacy addresses; all users are expected to have migrated to quantum-resistant address types by then. Phase B activates five years after deployment, fully deprecating legacy ECDSA and Schnorr signatures—any BTC remaining in vulnerable addresses will be effectively frozen. Phase C is an incomplete redress mechanism envisioning zero-knowledge proofs (ZKPs) to enable legitimate owners who retain their mnemonic phrases to recover frozen funds.
According to Live Bitcoin News, GitHub reviewer Conduition described Phase C as “the most critical component of any confiscatory freeze proposal” and argued that BIP-361 remains incomplete without it.
The proposal’s authors characterize the freeze mechanism as an “upgraded private incentive”: lost or frozen coins only slightly increase the value of others’ holdings, whereas coins recovered via quantum attacks would dilute everyone’s positions.
5.6 Million Dormant BTC and Satoshi’s $74 Billion Holdings
This debate has struck a nerve precisely because of its enormous scale.
Lopp estimates that approximately 5.6 million BTC—28% of total supply—have remained unmoved for over ten years. He and other analysts consider these coins highly likely lost. At current prices, their value stands at roughly $420 billion.
The most symbolically significant portion is Satoshi Nakamoto’s holdings. As reported by Cointelegraph, roughly 1.7 million BTC are locked in early P2PK addresses—including approximately 1.1 million BTC attributable to Satoshi—currently valued at ~$74 billion. The public keys for these addresses have long been publicly exposed on-chain; once quantum computing reaches a critical threshold, attackers could use Shor’s algorithm to derive private keys from public keys and seize control of the funds directly.
In his CoinDesk interview, Lopp warned that even without large-scale selling, “any credible evidence suggesting someone possesses the capability to recover lost or vulnerable coins using quantum computers would trigger immediate, widespread market panic.”
On Polymarket, the odds for “Will Satoshi Nakamoto move any Bitcoin in 2026?” currently stand at ~9.3%, up from 4.5% at the start of the year—but the market reaction to BIP-361’s release has been muted, suggesting it is still viewed as a governance discussion rather than an urgent catalyst.
Fierce Community Backlash: “Stealing Money to Prevent Theft”
BIP-361 strikes at Bitcoin’s deepest philosophical tenet: ownership should be unconditional. Upon its public release, criticism erupted swiftly.
Brian Trollz, editor at Bitcoin Magazine, outright rejected the proposal; Marty Bent, founder of TFTC, dismissed it as “ridiculous”; Phil Geiger, Head of Business Development at Metaplanet, sarcastically remarked: “We must steal people’s money to prevent their money from being stolen.”
A widely shared comment on X by user Cato the Elder read: “This quantum proposal is highly authoritarian and confiscatory… There is no reasonable justification for mandating upgrades and invalidating legacy spending paths. Upgrades must be 100% voluntary.”
Leo Fan, founder of Cysic and former head of quantum-resistance at Algorand, pointed out from a technical governance perspective: “Ownership becomes conditional. Holding the key no longer guarantees your ability to spend. This undermines Bitcoin’s promise as ‘unstoppable money.’” Still, Fan acknowledged that removing millions of BTC from circulation could tighten supply and thereby boost the price.
Discussions on Reddit’s r/cryptocurrency subreddit were equally heated (the post received 631 upvotes and 311 comments). The top-voted comment read: “If you fork to freeze wallets as a hedge against investment risk, BTC ceases to be BTC.” Another user expressed the opposite view: “Let them get hacked—let the price crash for a month. We’ll just accumulate again, just like during the last existential crisis.”
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