AI disclosure: drafted by Basis Desk's AI newsroom and machine-checked against the primary sources listed below — how we use AI. Originally published on Basis Desk.
The custodian holding roughly 5% of circulating BTC urges early preparation, proposed script upgrades, and multiparty computation compatibility.
Key points
- Coinbase published technical considerations on Oct. 14 for transitioning Bitcoin to quantum-resistant cryptography.
- The custodian urged adopting flexible container formats like BIP-360 (P2MR) alongside MPC-compatible signature schemes.
- Coinbase recommended evaluating candidate algorithms such as ML-DSA, SLH-DSA, FN-DSA, and SHRINCS while retaining stateless fallbacks.
Coinbase released a technical framework on Oct. 14 addressing Bitcoin's long-term vulnerability to cryptographically relevant quantum computers [1]. The crypto custodian, which holds roughly 5% of all circulating $BTC in existence, warned that upgrading the network's cryptographic foundations will require a multiyear effort that must begin well before quantum threats materialize [1]. At the time of writing, Bitcoin traded at $83,504.
The custodian called for separating Bitcoin's transaction container architecture from specific signature algorithms [1]. Coinbase pointed to proposals such as BIP-360 (Pay-to-Merkle-Root, or P2MR) and P2TRv2 as flexible script constructions that could let the network deploy or swap post-quantum algorithms without needing recurring protocol redesigns [1]. Under this model, wallets could adopt staged protections—such as a 1-of-2 spending condition pairing classical ECDSA or Schnorr keys with post-quantum alternatives—ahead of any permanent retirement of legacy signature schemes [1].
Signature Selection and Custody Constraints
Coinbase highlighted several post-quantum signature schemes for evaluation, including standardized options like ML-DSA and SLH-DSA, impending standards such as FN-DSA, and hash-based constructions like SHRINCS [1]. While stateful signature schemes offer smaller transaction footprints and faster processing, Coinbase cautioned that state synchronization errors can lead to key compromise or signature forgery, making stateless fallbacks essential [1].
Institutional requirements remain a focal point of the proposal [1]. Coinbase stressed that any chosen post-quantum signature system must support multiparty computation (MPC), hardware security modules, and threshold signing workflows relied on by institutional custodians [1]. The company also noted that developers should establish clear migration frameworks for dormant, lost, or slow-to-move UTXOs without stalling immediate protocol-level signature upgrades [1].
Sources
- Working Together on Bitcoin’s Post-Quantum Readiness — Primary document (discovered)
Basis Desk is a source-verified crypto newsroom. Market data, a free MCP server for AI agents and JSON APIs: basisdesk.news/developers. Not investment advice.
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