[DigitalToday reporter Hyunwoo Choo] Coinbase proposed a draft discussion for Bitcoin’s transition to a post-quantum system and said preparations should begin early for upgrading signature methods and moving funds.

On Oct. 14 (local time), blockchain media outlet CoinPost reported Coinbase’s view that preparations should start before it is confirmed that quantum computers can actually break cryptography, as consensus changes and ecosystem transitions could take years.

Coinbase is one of the world’s largest cryptocurrency custodians, holding about 5 percent of Bitcoin’s total supply. The proposal says a comprehensive strategy is needed, covering protection for funds whose public keys are already exposed and for new funds, responses to limited block capacity, maintaining independent verification by full nodes, institutional custody and retail wallet operations, and measures for coins that are difficult to move.

Technically, it supported a design that separates output types from signature methods. It said a structure that allows multiple post-quantum signatures to be added or replaced without redesign is preferable, and cited P2MR (BIP-360) and P2TRv2 as flexible candidates. As an example for the early transition stage, it presented a “1-of-2” configuration in which funds can be spent with either a classical signature or a post-quantum signature. It said retail wallets can keep using existing keys and switch to quantum-resistant keys when needed.

Coinbase took a cautious stance on stateful signatures. It said the approach can be small and fast, but reusing internal state could immediately lead to forgery. It also proposed prioritising verification methods that produce the same result across platforms, constant-time implementations, and resilience to failures in random number generation.

It also said that because large organisations use MPC to prevent key theft, at least one signature method should work well with MPC. It added that some lattice-based methods could be candidates.

It also said issues involving inactive coins, lost coins and coins with exposed public keys should be handled separately. Coinbase described this as a separate problem involving governance and engineering, and said that if a rescue mechanism is designed, it must be proven that the rescue route itself is safe from quantum computers and cannot be abused by attackers. It added that standards for handling cases where owners lose secret information such as seeds, and standards for setting deadlines on rescue measures, must also be clear.

The issue is also linked to discussions about handling early bitcoins believed to be held by Satoshi Nakamoto. The industry has discussed freezing those coins or moving them to safer addresses before quantum attacks become possible, but controversy could arise over infringement of property rights because assets would be moved without the owner’s consent.