About ten percent of bitcoins may be lost forever

Charles Hoskinson, the founder of Cardano, took part in a discussion around one of the most heated technical disputes in the bitcoin community, and his assessment turned out to be rather gloomy.

The reason for this was the BIP-361 initiative, which proposes to switch the bitcoin network to post-quantum cryptography. The so-called P2PK addresses, where the public key is openly stored in the blockchain, are under threat. If quantum computers reach sufficient power, such keys can theoretically be cracked and accessed. The proposal implies that if the owners do not transfer their assets to secure addresses, they may be frozen.

Hoskinson was skeptical about the mechanism for restoring access included in the initiative. According to him, the scheme simply does not take into account about 1.7 million BTC, mostly early coins mined before 2013, when the BIP-39 seed phrase standard did not even exist. Those wallets were designed differently: neither modern recovery methods nor zero-disclosure evidence-based solutions are applicable to them.

The result is a stalemate: either these coins remain vulnerable to future quantum attacks, or they are frozen, and the owners, if they are still alive and have access to the keys, will not be able to do anything. Hoskinson believes that the real threat could materialize as early as the 2030s.

Among the potentially vulnerable coins are those traditionally attributed to Satoshi Nakamoto, although this is a separate and much more complicated topic.