Coinbase Urges Bitcoin, Ethereum to Prepare Now for Quantum-Computing Threat

Coinbase warned that major blockchain networks, including Bitcoin (BTC) and Ethereum (ETH), need to prepare for the threat posed by quantum computing.

Decrypt reported on June 12 that Coinbase’s Quantum Computing Advisory Council urged the blockchain industry to begin preparing now for a transition to post-quantum cryptography.

The council said quantum computers have not yet advanced to the point where they can break the cryptographic systems used by Bitcoin and Ethereum. But it said the industry should prepare in advance given the speed of progress in the technology.

The report said older Bitcoin addresses with exposed public keys could be vulnerable to future quantum-computing attacks. It estimated that about 7 million BTC is currently exposed to quantum risk when cases such as address reuse are included.

Much of that total is believed to be holdings tied to Satoshi Nakamoto or long-dormant assets whose private keys have been lost.

The council said the biggest issue facing the industry is how to handle Bitcoin that is not moved to quantum-resistant addresses. It added that reaching social consensus could prove more difficult than solving the technical challenges.

The report laid out three options. The first would permanently freeze or burn Bitcoin held in vulnerable addresses after a certain point. The second would leave the issue to market participants without additional intervention. The third would be a compromise approach, such as limiting the amount that can be moved per block or introducing specialized cryptographic proofs.

The council said quantum computers are not yet capable of defeating current blockchain cryptography. Even so, it said the industry should start preparing now because it is impossible to know exactly when the threat could become real.