New Quantum Proposal Offers Bitcoin Holders a Way to Prove Control Without Exposing Funds

The threat of quantum computing to Bitcoin has long been intertwined with the issue of dormant accounts, including those of its creator, Satoshi Nakamoto. Approximately 1.1 million bitcoins, valued at around $84 billion, are attributed to Nakamoto and remain vulnerable to potential quantum attacks due to their use of older, less secure address types. A proposed solution involves a soft fork that would phase out these legacy addresses over a five-year period, compelling holders to migrate their assets to quantum-resistant formats. However, this approach poses a dilemma for long-dormant holders like Nakamoto, who would need to publicly move their funds to avoid losing access, thus revealing their identity. To mitigate this, Dan Robinson of Paradigm has introduced the concept of Provable Address-Control Timestamps (PACTs), which enables holders to timestamp proof of ownership without publicly revealing their assets. This is achieved by generating a unique cryptographic commitment using a random salt and BIP-322, then anchoring this data to the Bitcoin blockchain via OpenTimestamps. If a soft fork freezing quantum-vulnerable coins is implemented, holders can later submit a zero-knowledge proof (STARK) to verify their prior control, allowing them to spend their coins without revealing the original timestamp or address details. While PACTs offer a potential rescue path for wallets not covered by BIP-361, including those derived from BIP-32, their implementation hinges on Bitcoin adopting a STARK verification protocol, requiring substantial infrastructure development and community consensus. Ultimately, the success of PACTs in safeguarding assets like Nakamoto's depends on the proactive participation of the holders themselves.