Coinbase urges Bitcoin to begin quantum-resistant migration now

Cryptocurrency exchange Coinbase, holding approximately 5% of all bitcoin for institutional and retail clients, urges the Bitcoin community to immediately begin migrating to quantum-resistant cryptography. With Google Researchers projecting quantum computers could emerge by 2029 capable of cracking ECDSA and Schnorr signatures, Coinbase recommends flexible output designs, multi-party computation compatibility, and staged upgrades to prevent delays.

Quantum computing threat to Bitcoin security

• ▪A cryptographically relevant quantum computer could reverse-engineer private keys from exposed public keys on the Bitcoin network and drain vulnerable wallets
• ▪Google Researchers project that a cryptographically relevant quantum computer capable of breaking Bitcoin's security algorithms could potentially exist by 2029
• ▪Dormant or long-inactive Bitcoin wallets, including those with lost keys or exposed public keys, face the risk of silent quantum theft before public detection occurs
• ▪Bitcoin currently verifies digital transaction signatures using the classical cryptographic algorithms ECDSA and Schnorr, which existing non-quantum computers are unable to reverse-engineer

Need for immediate post-quantum preparations

• ▪Bitcoin developers are evaluating post-quantum proposals such as P2MR (BIP-360) and P2TRv2, but consensus changes take years because Bitcoin's decentralized architecture lacks a central authority to enforce upgrades
• ▪Coinbase urges the Bitcoin community to begin quantum-resistant migration immediately, well ahead of any formal announcement that a cryptographically relevant quantum computer has been built, because consensus changes take years

Coinbase recommendations for post-quantum design

• ▪If Bitcoin supports stateful post-quantum signature schemes, Coinbase recommends it must also offer stateless options to prevent key-reuse errors that could lead to signature forgery
• ▪Coinbase recommends selecting post-quantum signature schemes that are compatible with multi-party computation to protect institutional custody infrastructure against key theft
• ▪Coinbase supports a staged transition approach, such as a 1-of-2 setup, allowing active wallets to be spent using either a classical key or a post-quantum key before legacy signature rules are finalized
• ▪Coinbase recommends flexible post-quantum output designs, such as P2MR (BIP-360) and P2TRv2, that separate the transaction container from the signature scheme

Coinbase's post-quantum outlook

• ▪Coinbase, which holds approximately 5% of all existing bitcoin for clients including banks, asset managers, and hedge funds, stated it is currently preparing its own internal systems for a post-quantum future
• ▪Coinbase stated that it wants to contribute to post-quantum development efforts and expressed confidence that Bitcoin will remain the most trusted cryptocurrency in a post-quantum world

Post-quantum upgrade requirements

• ▪A complete post-quantum upgrade recommended by Coinbase must protect exposed and newly created funds, fit within Bitcoin's block space, preserve full node validation, and support both institutional custody systems and ordinary wallets
• ▪Coinbase recommended that post-quantum Bitcoin software evaluations prioritize implementations that avoid timing leaks, run reliably across platforms, and remain secure if random-number generators fail

Handling dormant and inactive coins

• ▪Coinbase recommends that the debate over handling dormant, late-migrating, or lost coins be conducted separately from technical work on post-quantum signatures to avoid delaying general network protections
• ▪Coinbase stressed that any mechanism created to rescue inactive or late-migrating Bitcoin wallets must itself be quantum-safe to prevent attackers from exploiting the rescue method

Debatable claims

• ▪Bitcoin should immediately begin software preparations for post-quantum cryptographic migration
• ▪Bitcoin's decentralized governance makes coordinating a network-wide upgrade to post-quantum cryptography a significant challenge