Satoshi Nakamoto’s Bitcoin May Be Stolen, But BTC Dev Has Developed A Solution
Satoshi Nakamoto’s Bitcoin holds are vulnerable to theft as the quantum threat becomes a possibility. BTC developer Hunter Beast notably proposed the Hourglass V2 proposal amid debates about how best to handle the Satoshi supply, to reduce the impact of the selling pressure Bitcoin would face if these coins were stolen.
BTC Dev Offers a Solution for How to Manage Satoshi Nakamoto’s Bitcoin Holdings
Beast proposed a 2nd version of the Hourglass proposalwhich aims to limit the output of Pay-to-Public-Key (P2PK) which can be included in the input made to 1 BTC per block. It is worth noting that Satoshi Nakamoto’s Bitcoin stash of about 1.1 million BTC is a P2PK address, which exposes the public key and makes it highly vulnerable quantum attack.
A Chainalysis report revealed that approximately 718 billion Bitcoins are held by addresses that are vulnerable to quantum attacks, including these P2PK addresses. Therefore, Bitcoin can face an unprecedented supply shock if these coins are stolen by quantum attackers.
The Beast’s Hourglass proposal aims to reduce selling pressure to a minimum while providing consensus on whether to freeze or burn. Coins by Satoshi Nakamoto to prevent them from falling into the wrong hands. The Hourglass v2 proposal also noted that burning or freezing these coins could be considered foreclosure, which could set a dangerous precedent for changing Bitcoin’s monetary policy going forward.
When implemented, the Hourglass V2 proposal will ensure that only one P2PK output can be included as a transaction input per block. In addition, no P2PK output to any currently unused address can be created. Finally, no P2PK output can be created from other output types.
At the same time, it should be noted that this proposal only applies to P2PK addresses, and some of the consequences of price threats remain at risk. This is because imposing similar restrictions on other types of output may limit the substitution of Bitcoin addresses are quantum resistant. These other types of output are still widely used, unlike Satoshi Nakamoto’s P2PK address, which makes the latter easy to sunset.
Reason for Proposal
The Hourglass V2 proposal will limit P2PK output to approximately 144 BTC per day. Beast noted that this should effectively reduce the market impacts of quantum attacks on P2PK coins since. these quantum invaders it cannot dump all Bitcoin at once.
Without such restrictions, more than 6,000 P2PK switch can be done per block, releasing more than 300,000 BTC per block into the market. At such a rate, all P2PK coins, including Satoshi Nakamoto’s, could be spent in just a few hours.
However, under the rules of Hourglass V2, it would take more than 32 years to move all P2PK coins, which greatly reduces the market risk associated with quantum. The good thing is that the original key holders, like Satoshi Nakamoto, should always be able to move their coins even after the proposal is activated, as long as there are no quantum actors competing for P2PK activities.
Featured image from Pixabay, chart from Tradingview.com
Planning process because bitcoinist focuses on delivering well-researched, accurate, and unbiased content. We maintain strict sourcing standards, and each page is diligently reviewed by our team of senior technical experts and experienced editors. This process ensures the integrity, relevance, and value of our content to our readers.
