Charles Hoskinson of Cardano Claims Bitcoin's Quantum Solution is a Hard Fork that Cannot Protect Satoshi's Coins

Earlier this week, Bitcoin's core developers suggested freezing 8 million coins as a defense against quantum attacks. However, Charles Hoskinson, the founder of Cardano, believes this solution is still unable to safeguard the coins belonging to the network's pseudonymous creator, Satoshi Nakamoto, as stated in a video on his YouTube channel. Hoskinson argues that Bitcoin's proposed defense against quantum computers is technically mislabeled and incapable of protecting the network's oldest coins, including the approximately 1 million bitcoin attributed to Satoshi Nakamoto. He claims that BIP-361, a proposal to phase out quantum-vulnerable bitcoin addresses, is being misrepresented as a soft fork when it would actually require a hard fork, as it invalidates existing signature schemes that users are actively relying on. According to Hoskinson, this distinction is crucial, given Bitcoin's historical opposition to hard forks, which are seen 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 so fundamentally that old software stops working entirely, potentially causing the network to split unless everyone upgrades. BIP-361 proposes 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 argues that this approach cannot rescue 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 from the original Bitcoin wallet software, which relied on a local key pool rather than a deterministic seed. If the proposal passes in its current form, those coins would remain permanently frozen, regardless of whether their original owners attempt to migrate, because migration would require cryptographic proof 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 argues that freezing dormant coins, estimated 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.