Prefer freezing 5.6 million dormant BTC rather than letting them fall into the hands of quantum hackers.

The proposal involves approximately 1.7 million BTC held in P2PK addresses (including Satoshi’s estimated 1.1 million BTC and holdings worth around $74 billion), with nearly 34% of all Bitcoin globally exposed to quantum attacks due to publicly revealed public keys. The release of the proposal triggered fierce backlash from the community, with critics labeling it a "authoritarian-style confiscation." However, Lopp responded that he would rather freeze 5.6 million dormant BTC than risk their compromise by quantum hackers.

Renowned cryptopunk and Casa’s Chief Technology Officer Jameson Lopp, alongside five researchers, submitted a draft titled BIP-361—“Post Quantum Migration and Legacy Signature Sunset”—to GitHub’s bitcoin/bips repository on April 14. The core proposition is straightforward: before quantum computers can break existing cryptographic algorithms, the network should proactively freeze all Bitcoin wallets relying on outdated signature schemes.

According to CoinDesk, Lopp stated in an interview that he does not currently see immediate necessity for these measures but emphasized that he is engaging in “adversarial thinking about potential future threats.” On X, he further admitted: “I know people don’t like this proposal. I don’t like it either. But I wrote it because I dislike the alternative even more.”

Three-Phase “Sunset Plan”: From Restriction to Freeze

BIP-361 builds upon BIP-360, published earlier this year. BIP-360 introduced a new address format called P2MR (pay-to-Merkle-root), similar to existing Taproot addresses but removing key path elements vulnerable to quantum attacks, thereby providing forward security for new coins. BIP-361 aims to resolve the legacy issue: as of March 1, 2026, over 34% of Bitcoin on-chain has already exposed its public keys—data directly cited from the BIP-361 document itself.

The proposal outlines three progressive phases:

Phase A takes effect approximately three years after activation, at which point the network will prohibit sending new BTC to legacy addresses, ensuring all users have migrated to quantum-resistant address types. Phase B activates five years post-activation, completely retiring old ECDSA and Schnorr signatures; any Bitcoin remaining in vulnerable addresses will be effectively frozen. Phase C remains incomplete—a proposed mechanism leveraging zero-knowledge proofs (ZKPs) to enable legitimate owners holding seed phrases to reclaim frozen funds.

According to Live Bitcoin News, GitHub reviewer Conduition described Phase C as “the most critical component of any proposal involving confiscatory freezing,” arguing that without such a mechanism, BIP-361 is fundamentally incomplete.

The authors characterize the freeze mechanism as a “upgraded private incentive”: lost or frozen coins would only slightly increase the value of others’ holdings, whereas recovery via quantum attack would devalue everyone’s portfolio.

5.6 Million Dormant BTC and $74 Billion Satoshi Holdings

This debate strikes a nerve due to its immense scale.

Per Lopp’s estimate, approximately 5.6 million BTC—28% of total supply—have not moved in over ten years, with him and other analysts believing these coins are likely lost. Valued at current prices, these dormant tokens are worth roughly $420 billion.

The most symbolic holding is Satoshi’s stash. As reported by Cointelegraph, around 1.7 million BTC are locked in early P2PK addresses, including approximately 1.1 million BTC attributed to Satoshi, currently valued at about $74 billion. These addresses have had their public keys exposed on-chain for years; once quantum computing reaches critical capability, attackers could reverse-engineer private keys from public keys using Shor’s algorithm, gaining direct control over the funds.

In a CoinDesk interview, Lopp warned that even without large-scale sell-offs, “the mere credible evidence that someone possesses the ability to recover lost or vulnerable coins using quantum computers would trigger immediate market panic.”

On Polymarket, the odds for “Will Satoshi move any Bitcoin by 2026?” stand at around 9.3%, up from 4.5% at the beginning of the year, yet the response to BIP-361’s release has been muted, suggesting the market still views it as a governance discussion rather than an urgent catalyst.

Community Backlash Intense: “Stealing Money to Prevent Theft”

BIP-361 touches on Bitcoin’s deepest philosophical tenet: ownership must be unconditional. Upon public release, criticism erupted rapidly.

Bitcoin Magazine editor Brian Trollz outright rejected the proposal; TFTC founder Marty Bent called it “absurd”; Metaplanet’s business development lead Phil Geiger sarcastically remarked: “We must steal people’s money to prevent their money from being stolen.”

X platform user Cato the Elder’s comment went viral: “This quantum proposal is highly authoritarian and confiscatory… There is no rational justification for forcing upgrades and invalidating old spending paths. Upgrades must be 100% voluntary.”

Cysic co-founder and former Algorand quantum-resistance lead Leo Fan pointed out from a technical governance perspective: “Ownership becomes conditional. Holding a key no longer guarantees you can spend. This undermines Bitcoin’s promise of ‘unstoppable money.’” Yet Fan also acknowledged that removing millions of BTC from circulation could tighten supply, thus driving up coin price.

Discussions on Reddit’s r/cryptocurrency were equally heated (this post received 631 upvotes and 311 comments). The top-rated 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 still bottom-fish, just like during past survival crises.”

Source: DeepTide TechFlow