Post-Quantum Bitcoin Recovery Plan Proposed by BitMEX Research

Researchers are currently in a rush to find new ways to “quantum-proof” Bitcoin. 

BitMEX Research has proposed a series of technical escape routes that would allow users to recover their Bitcoin even if the network is forced to freeze vulnerable coins to prevent theft.

The ‘quantum freeze’

Bitcoin developers might be forced to implement a “soft fork freeze.” This will effectively lock any coins held in vulnerable legacy addresses (like P2PKH or P2PK) so they cannot be spent by anyone.

However, if the attacker can’t spend the coins, neither can the legitimate owner. The money is effectively lost.

BitMEX proposes several methods to unlock these frozen coins using quantum-safe recovery transactions. 

For standard wallets, BitMEX outlines a clumsy but effective two-step process to recover funds. The user broadcasts a transaction containing a “hash commitment” of their private key or seed phrase. After a waiting period (e.g., 100 blocks), the user broadcasts a second transaction that reveals the key or seed phrase.

Zero-Knowledge Proofs (ZKPs) are a more advanced solution since a user wouldn’t need to reveal their private key at all. Instead, they would attach a ZKP to their transaction proving they know the seed phrase. 

Saving Satoshi’s coins

There are varying degrees of risk associated with Bitcoin address types. Legacy addresses (P2PK), which represent roughly 8.6% of supply, include the famous coins mined by Satoshi Nakamoto in 2009.

BitMEX has proposed a “Pre-QDay Commitment” where users could broadcast a hash of their keys before quantum computers arrive.