Charles Hoskinson Criticizes Bitcoin's Quantum Solution as Insufficient to Protect Satoshi's Coins

Earlier this week, Bitcoin's core developers proposed a solution to protect against quantum attacks by freezing 8 million coins. However, according to Cardano founder Charles Hoskinson, this solution is still insufficient to safeguard the coins belonging to the network's creator, Satoshi Nakamoto. Hoskinson expressed his concerns in a video posted on his YouTube channel, stating that the proposed defense mechanism is both technically incorrect and incapable of protecting the network's oldest coins. He argued that the proposal, BIP-361, is being misleadingly presented as a soft fork when it would actually require a hard fork, as it would invalidate existing signature schemes. Hoskinson emphasized that the distinction between a soft fork and a hard fork is crucial, as Bitcoin's development culture has historically opposed hard forks due to their potential to compromise the network's immutability. The BIP-361 proposal suggests that users can reclaim their frozen funds by creating a zero-knowledge proof tied to their BIP-39 seed phrase. Nevertheless, Hoskinson pointed out that this approach would not be able to rescue approximately 1.7 million bitcoins that predate the introduction of BIP-39 in 2013, including the roughly 1 million coins associated with Satoshi's early mining activity. These early coins were generated using a different key derivation method, which relied on a local key pool rather than a deterministic seed. As a result, if the proposal is implemented in its current form, those coins would remain permanently frozen, regardless of whether their original owners attempt to migrate. Jameson Lopp, the core developer who co-authored BIP-361, has acknowledged that the proposal is not ideal and hopes it will never be necessary. Lopp estimates that freezing dormant coins, which he believes to be around 5.6 million bitcoins, would be preferable to allowing a future quantum attacker to recover and dump them on the market. Hoskinson's criticism extends beyond the technical aspects, arguing that Bitcoin's lack of formal on-chain governance hinders the network's ability to resolve tradeoffs through a structured process, forcing contentious upgrades to be negotiated through developer mailing lists and social pressure.