New Proposal Enables Bitcoin Holders to Prove Control Without Transferring Funds

Concerns about quantum computing have long been intertwined with the enigma of Satoshi Nakamoto. Millions of bitcoins, including those attributed to the pseudonymous creator, worth approximately $84 billion, are at risk due to exposed public keys in outdated wallets. A proposed solution involves a soft fork that would eventually disallow transactions from these legacy addresses, forcing holders to migrate to quantum-secure formats. However, this approach poses a dilemma for dormant holders like Satoshi, who would have to publicly reclaim their assets or risk losing them. Dan Robinson of Paradigm has introduced an alternative, dubbed Provable Address-Control Timestamps (PACTs), which enables holders to timestamp proof of ownership without revealing their identity or transferring coins. This method involves generating a unique cryptographic commitment using a random salt and BIP-322, then anchoring it to the Bitcoin blockchain via OpenTimestamps. If Bitcoin implements a soft fork that freezes vulnerable coins, holders can later submit a zero-knowledge proof to redeem their assets without disclosing sensitive information. While PACTs offer a potential solution for wallets derived through BIP-32, they require the adoption of a STARK verification protocol, which would necessitate a separate soft fork and substantial infrastructure development. Ultimately, the success of PACTs hinges on the participation of holders like Satoshi, who must proactively create a commitment to protect their assets.