Charles Hoskinson Criticizes Bitcoin's Quantum Computing Fix, Claims It Won't Protect Satoshi's Coins

This week, Bitcoin's core developers put forth a proposal to freeze 8 million coins as a defense mechanism against quantum attacks. However, Charles Hoskinson, the founder of Cardano, believes that this solution is still incapable of protecting the coins belonging to Satoshi Nakamoto, the network's pseudonymous creator, as stated in a video posted on his YouTube channel. Hoskinson claims that Bitcoin's proposed defense against quantum computers is both technically incorrect and structurally flawed, making it impossible to safeguard the network's oldest coins, including the roughly 1 million bitcoin attributed to Satoshi. He asserts that BIP-361, a proposal aimed at phasing out quantum-vulnerable bitcoin addresses, is being misrepresented as a soft fork when, in reality, it would require a hard fork due to its invalidation of existing signature schemes that users currently rely on. According to Hoskinson, 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 a violation of 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 tightens the rules, allowing old software to continue functioning, albeit without access to new features. In contrast, a hard fork fundamentally alters the rules, causing old software to cease working entirely and resulting in a network split unless all users upgrade. BIP-361 suggests 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. Nonetheless, Hoskinson argues that this approach is incapable of rescuing 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 acknowledged that he does not like 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, which he estimates at 5.6 million bitcoin, 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 these tradeoffs through a structured process, forcing contentious upgrades to be negotiated through developer mailing lists and social pressure.