CZ floats freezing Satoshi's $70B Bitcoin over quantum risk

Changpeng Zhao floated freezing Satoshi Nakamoto's estimated 1.1 million Bitcoin and other dormant, quantum-vulnerable coins if they remain unmoved after a future network upgrade. He raised it as a question for the community, not a personal plan.

"If we can identify those addresses and they haven't moved for a period of time, why shouldn't we freeze them?" Zhao said on the Galaxy Brains podcast with Galaxy Research head Alex Thorn. He has since pushed back on reports that he would personally freeze Satoshi's address for a year.

The debate escalated in March after Google Quantum AI published research showing a quantum computer with fewer than 500,000 qubits could break Bitcoin's digital signatures in minutes. More than a third of all Bitcoin had revealed a public key on-chain by March, leaving those addresses vulnerable to quantum theft, where a quantum computer could derive private keys from public keys and drain the wallets they protect.

Satoshi's estimated 1.1 million BTC, worth roughly $70 billion at current prices, sits across about 22,000 addresses, many containing around 50 BTC, according to Galaxy's Alex Thorn. Zhao's thinking aligns with BIP-361, a draft by Jameson Lopp and five researchers that would block sends to vulnerable addresses about three years after activation, then void legacy signatures two years later.

A Community Divided

Bitcoin developers and advocates remain split on how to handle coins secured by older cryptographic standards. The Coinbase advisory board published a report in June arguing Bitcoin should begin preparing a migration path to post-quantum cryptography before quantum computers become a realistic threat. Supporters cited in the report argue that freezing unmigrated coins could prevent future attackers from obtaining large amounts of Bitcoin and potentially affect market stability.

Critics, including Galaxy's Thorn, argue that making dormant coins unspendable would amount to confiscating private property and conflict with Bitcoin's principles of immutability and user control. Thorn warned that some community members may prefer enduring a severe market decline rather than approving protocol changes that alter control over long-dormant wallets, including those associated with Bitcoin's creator.

The Satoshi Problem

Identifying Satoshi's wallets from other early miners is difficult, Zhao acknowledged. An anonymous plaintiff and two Wyoming LLCs are already fighting a New York abandoned-property lawsuit seeking to claim 39,069 idle addresses, including the Satoshi coins. A Galaxy report by Thorn doubts that effort will prevail.

The BIP-361 proposal even cites Satoshi's own words on lost coins. "Lost coins only make everyone else's coins worth slightly more. Think of it as a donation to everyone," Satoshi Nakamoto wrote, as quoted in the proposal.

Zhao said there is no perfect answer. He warned that doing nothing could prove the worst outcome of all. The authors of BIP-361 frame a blunt choice: a quantum thief could grab the exposed coins, or miners could slowly recover them. The network could instead lock them so no one wins.

This article is for informational purposes only and does not constitute investment advice.