El Salvador Splits $682M Bitcoin Reserve Into 14 Wallets Amid Security Fears

• El Salvador moves $682M Bitcoin into 14 wallets for safety.
• National Bitcoin Office cites quantum computing risks in reserve split.
• IMF disputes El Salvador’s daily Bitcoin purchases despite official claims.

El Salvador has shifted its national Bitcoin reserve into 14 different wallets, breaking up nearly $682 million in holdings. According to the National Bitcoin Office, the restructuring aims to strengthen security and reduce risks tied to advances in quantum computing.

Until this change, the country’s entire reserve of 6,284 BTC was stored in one address. The new setup ensures that no wallet holds more than 500 BTC, limiting exposure if any single address were compromised.

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A Strategic Shift in Bitcoin Custody

President Nayib Bukele’s government has continued to promote Bitcoin as a central pillar of economic strategy. They say they buy one BTC a day and add to the reserve, which is now in multiple addresses.

Officials stated that allocating the funds is in keeping with international best practice for Bitcoin custody. They said that unused Bitcoin addresses with hashed public keys represent better protection against future cryptographic threats.

Quantum computing is some time away from truly threatening Bitcoin’s security, especially its digital signature system. Analysts have noted that practical risks could still be decades away, yet El Salvador has acted early to adapt its reserve management.

IMF Tensions Over Daily Purchases

Despite the office’s claims of steady accumulation, contradictions persist with official financial disclosures. The central bank governor and finance minister, in a joint statement to the International Monetary Fund, confirmed that no Bitcoin has been purchased by the public sector since February.

That assurance was part of conditions attached to an IMF loan agreement, which directly conflicted with the office’s daily purchase announcements on social media. So far, Bukele’s administration has not responded publicly to this discrepancy.

By diversifying its Bitcoin reserve, El Salvador has adopted a defensive strategy to mitigate the risks of concentration and future technological threats. However, uncertainty remains over whether the nation is truly adding to its holdings as claimed.

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