Charles Hoskinson Claims Bitcoin's Quantum Solution is a Hard Fork That Fails to Protect Satoshi's Coins

Bitcoin developers recently suggested freezing 8 million coins to defend against quantum attacks. However, Charles Hoskinson, the founder of Cardano, believes this solution is still insufficient to protect the coins owned by Satoshi Nakamoto, as stated in a video on his YouTube channel. Hoskinson argues that the proposed defense mechanism against quantum computers is both technically incorrect and structurally incapable of safeguarding the network's earliest coins, including the roughly 1 million bitcoin attributed to Satoshi Nakamoto. He claims that BIP-361, which aims to phase out quantum-vulnerable bitcoin addresses, is being misleadingly presented as a soft fork when it would actually require a hard fork, as it would invalidate existing signature schemes that users are currently relying on. The distinction between a soft fork and a hard fork is crucial, as Bitcoin's development culture has historically opposed hard forks, viewing them as violations of the network's immutability. A soft fork tightens the rules, allowing old software to continue working but without access to new features, whereas a hard fork changes the rules so fundamentally that old software stops working entirely, causing the network to split unless all users upgrade. BIP-361 proposes that users with frozen quantum-vulnerable funds could reclaim them by creating a zero-knowledge proof tied to their BIP-39 seed phrase, a standard for generating wallet keys from a recoverable phrase. Nevertheless, Hoskinson argues that this approach is unable to rescue approximately 1.7 million bitcoin 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 from the original Bitcoin wallet software, which relied on a local key pool rather than a deterministic seed. If the proposal is implemented in its current form, those coins would remain permanently frozen, regardless of whether their original owners attempt to migrate, as migration would require cryptographic proof that they are unable to provide. Jameson Lopp, the core developer who co-authored BIP-361, has expressed his dislike for the proposal, describing it as a rough idea for a contingency plan rather than a finalized specification. Lopp argues that freezing dormant coins would be preferable to allowing a future quantum attacker to recover and dump them on the market. Hoskinson's broader critique extends beyond the technical details, arguing that Bitcoin's lack of formal on-chain governance leaves the network unable to resolve tradeoffs through a structured process, forcing contentious upgrades to be negotiated through developer mailing lists and social pressure.