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

Earlier this week, Bitcoin's core developers proposed a plan to freeze 8 million coins as a defense mechanism against quantum attacks. However, Charles Hoskinson, the founder of Cardano, believes this plan is insufficient to protect the coins belonging to Satoshi Nakamoto, the network's pseudonymous creator. In a video posted on his YouTube channel, Hoskinson expressed his concerns that the proposed solution, BIP-361, is both technically incorrect and structurally flawed, making it incapable of safeguarding the network's oldest coins, including the approximately 1 million bitcoin attributed to Satoshi Nakamoto. Hoskinson argued that BIP-361 would require a hard fork, as it invalidates existing signature schemes that users are currently relying on. He emphasized that the distinction between a hard fork and a soft fork is crucial, as Bitcoin's development culture has historically opposed hard forks due to their potential to violate the network's immutability. The authors of BIP-361 have described the proposal as a soft fork, a characterization that Hoskinson disputes. A soft fork typically tightens the rules, allowing old software to continue functioning, albeit without access to new features. In contrast, a hard fork fundamentally alters the rules, rendering old software obsolete and potentially causing the network to split unless all users upgrade. BIP-361 suggests that users with frozen quantum-vulnerable funds could reclaim them by constructing a zero-knowledge proof tied to their BIP-39 seed phrase. However, Hoskinson argued that this approach is ineffective for 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, which relied on a local key pool rather than a deterministic seed. As a result, if the proposal passes in its current form, these coins would remain permanently frozen, regardless of whether their original owners attempt to migrate, due to the lack of cryptographic proof. Jameson Lopp, the core developer who co-authored BIP-361, has acknowledged that he is not fond of the proposal and hopes it never needs to be adopted, describing it as a rough idea for a contingency plan rather than a finalized specification. Lopp has argued that freezing dormant coins, estimated to be around 5.6 million bitcoin, would be preferable to allowing a future quantum attacker to recover and dump them on the market. Hoskinson's critique 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.