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 solution to counter quantum attacks by freezing 8 million coins. However, according to Cardano founder Charles Hoskinson, this solution is still insufficient to safeguard coins owned by Satoshi Nakamoto, the network's pseudonymous creator. Hoskinson expressed his views in a video posted on his YouTube channel, arguing that the proposed defense mechanism against quantum computers is both technically incorrect and structurally flawed, making it incapable of protecting the network's oldest coins, including the roughly 1 million bitcoin attributed to Satoshi. He believes that BIP-361, a proposal aimed at phasing 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 historically opposed hard forks, viewing them as a violation of the network's immutability. Hoskinson claims that the proposal's authors have falsely characterized it as a soft fork. A soft fork allows old software to continue working, albeit without access to new features, whereas a hard fork alters the rules so fundamentally that old software becomes obsolete, leading to a network split unless all users upgrade. The proposal suggests that users with frozen quantum-vulnerable funds could recover 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 the introduction of BIP-39 in 2013, including the roughly 1 million coins associated with Satoshi's early mining activities. 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 is implemented in its current form, these coins would remain permanently frozen. Jameson Lopp, the core developer who co-authored BIP-361, has acknowledged that the proposal is not ideal and hopes it will never be adopted, describing it as a rough 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 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.