El Salvador has reviewed the structure of his Bitcoin treasure, moving away from a single wallet system to a diversified model.
On August 30, Bitcoin’s National Office confirmed that it will store reservations in several directions, each with no more than 500 BTC.
Why El Salvador is changing his Bitcoin Treasury Reserve Model
The Salvadoran government said that redistribution is aligned with global best practices in digital asset management. He also explained that the movement addresses long -term concerns about quantum computing.
According to the government, quantum machines could theoretically decipher the cryptography that protects Bitcoin’s keys. This possibility raises long -term questions about the safety of digital wallets.
Previously, El Salvador depended on a single continuously reused direction. That practice caused his public key to be permanently visible, giving the attackers unlimited time to try a violation.
The new system avoids this risk by disseminating holdings in multiple unused addresses while publishing the list publicly to guarantee responsibility.
Given this, the Bitcoin office said that distributing funds reduces exposure to limiting the amount stored in each wallet. It also prevents the unused public keys from appearing in the block chain until transactions occur.
“Limiting funds in each direction reduces exposure to quantum threats because a Bitcoin direction not used with public keys hash remains protected. Once the funds of an address are spent, their public keys are revealed and vulnerable. By dividing funds into smaller quantities, the impact of a amount of potential potential is minimized,” the government argued.
Stacy Herbert, who runs the Bitcoin National Office, framed the measure as a precaution and strategic.
“El Salvador was the first to establish a strategic Bitcoin reserve and we continue to lead the way to establish the best practices for this era of true sovereignty and money of freedom,” he said.
Meanwhile, the decision has caused positive reactions of industry figures.
Nick Neuman, co -founder of the custody firm of Bitcoin Casahodl, described it as an encouraging example of how large -scale holders can anticipate future threats.
“It is great to see the large/public BTC holders who take proactive measures to protect against future quantum threats. El Salvador remains a good model of how nations should administer Bitcoin’s treasure bonds,” Neuman wrote.
This development occurs a month after the International Monetary Fund (IMF) affirmed that El Salvador has not significantly increased its Bitcoin stash. Instead, it was argued that most of the activities involved internal transfers instead of new purchases.
Despite this, the Central American country has continued to announce new purchases of Bitcoin, taking its total holdings to 6,284 BTC (with a value of more than $ 681 million). At the time of the publication, Mononaut, the pseudonym founder of Mempool, informed that these funds have extended in 14 new directions.
In particular, President Nayib Bukele recently hinted that the figure could address $ 1 billion by the end of the year.
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