The Quantum Computing Threat For Satoshi Nakamoto's 1 Million Bitcoins

Key Takeaways:

Quantum Threat to Early Bitcoin Transactions: The 1 million Bitcoins associated with Satoshi Nakamoto are particularly vulnerable due to the Pay-to-Public-Key (P2PK) format, which exposes public keys and could be exploited by advanced quantum computers.
Freezing Bitcoin Sparks Debate: Proposals to freeze Satoshi’s Bitcoins to prevent exploitation are contentious, as they challenge Bitcoin’s principle of immutability and decentralization, potentially setting a dangerous precedent.
Preparing for Quantum Advancement: The rapid progress in quantum computing necessitates proactive measures, such as developing post-quantum cryptography and upgrading Bitcoin’s security infrastructure, to safeguard the cryptocurrency ecosystem.

The Vulnerability of Early Bitcoin Transactions

Quantum computing has introduced some security vulnerabilities to Bitcoin, particularly for the 1 million Bitcoins believed to be owned by Satoshi Nakamoto, due to the use of the Pay-to-Public-Key transaction format in early Bitcoin transactions. Unlike in the modern format, the Pay-to-Public-Key-Hash, when using P2PK, the public key is exposed on the blockchain. That is to say, theoretically, a sufficiently powerful quantum computer could work out the private key from the public key and, therefore, access and spend such Bitcoins. Emin Gün Sirer, founder and CEO of Ava Labs, was one of the first to raise this vulnerability.

Freezing Satoshi’s 1 Million Bitcoins: Solution or Challenge?

Some even go as far as to propose freezing those Bitcoins so they cannot be exploited anymore. It would be changing Bitcoin’s consensus rules in such a way that certain P2PK vulnerable UTXOs (Unspent Transaction Outputs) can no longer be spent. It requires huge community consensus, though—something that has often turned out to be very tough for Bitcoin.

Satoshi Nakamoto

Of course, such an act would require an implementation through Bitcoin Improvement Proposal, clearly defining UTXOs with the exact vulnerability of P2PKs and gaining public consensus. Freezing can also be done by a non-mandatory soft fork (an all-node software upgrade) or a more complex hard fork (an actual migration to an entirely new chain version). Either of these pathways would potentially lead to an extremely contentious and divisive development within the community.

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