Charles Hoskinson Claims Bitcoin's Quantum Solution is a Hard Fork That Won't Protect Satoshi's Coins

Earlier this week, Bitcoin's core developers proposed a plan to freeze 8 million coins as a defense against quantum attacks. However, Charles Hoskinson, the founder of Cardano, believes this plan is still insufficient to protect the coins belonging to Satoshi Nakamoto, the network's pseudonymous creator, as stated in a video posted on his YouTube channel. Hoskinson argues that the proposed defense against quantum computers, 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. 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 due to its invalidation of existing signature schemes. The distinction between a soft fork and a hard fork is crucial, as Bitcoin's development culture has traditionally opposed hard forks, viewing them as violations of the network's immutability. A soft fork tightens the rules, allowing old software to still work but without access to new features, whereas a hard fork changes the rules fundamentally, causing old software to stop working entirely and potentially splitting the network 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. However, Hoskinson argues that this approach is ineffective for approximately 1.7 million bitcoin that predate BIP-39's introduction 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, making it impossible for their owners to provide the necessary cryptographic proof for migration. If the proposal passes in its current form, these coins would remain permanently frozen. 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 critique extends beyond the technical details, 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.