A radical proposal to freeze legacy Bitcoin wallets—potentially including Satoshi Nakamoto's own holdings—has ignited a civil war within the crypto community, forcing a stark choice between preemptive security and the network's foundational censorship-resistant principles. The BIP-361 proposal, championed by cypherpunk Jameson Lopp and vehemently opposed by figures like Adam Back, aims to shield the network from a future quantum computing attack but risks fracturing Bitcoin's core ethos.

Who wants to freeze addresses on Bitcoin? 

Supporters of BIP-361 have proposed a ‘post quantum migration and legacy signature sunset.’ The proposal went live on April 14, sparking a broader discussion of quantum resistance. Rough estimates suggest that around 6.7M BTC may be at risk of quantum attacks due to being held in early, less secure addresses.

BIP-361 is still in its draft phase, with no deadline for signaling support. Responsibility for quantum-proof holding will be personal, with each wallet holder required to upgrade. 

In the first stage, the proposal will freeze new transactions to quantum-vulnerable addresses, causing the network to shift to PQ address types. In phase B, all spending to vulnerable addresses will be blocked. The second stage may have a five-year grace period. 

In the future, the network may introduce a quantum-safe method for proving ownership and recovering lost BTC. 

The argument for freezing BTC is that hacked funds could be sold, undermining its price and general trust. Supporters of the proposal believe quantum hacking will occur and that the old BTC ethos of self-ownership, with no centralized censorship or freezing, is outdated. 

Can BTC survive quantum hacking? 

Achieving real quantum hacking may be more involved than expected. Satoshi Nakamoto’s addresses use the P2PK standard, meaning their exposed public keys leave them vulnerable to hacking. 

However, Satoshi’s stash is spread across over 22,000 addresses, and each one will have to be hacked before releasing the coins. 

The other argument against BIP-361 is that quantum computers are not yet easily available outside a research context, and it is highly improbable that they would be used for attacks. The approach may also be too expensive to perform, at least in the early stages of quantum computing. Currently, quantum algorithms are improving, lowering the requirements for a physical computer, but still far from a real attack.

The proposal underscores the need to change BTC for its long-term survival, while not undermining market value, reputation, and the proof of work to date. The migration to quantum-proof addresses raises the issue of what makes a ‘real’ BTC coin. 

Other suggestions include a hard fork to a quantum-proof network at a predetermined block, with a long grace period to claim coins. A similar solution was suggested by Satoshi Nakamoto in the early days of BTC. 

Some suggest leaving the BTC network as it is, with old wallets left as a bounty for the creators of viable quantum computers. Overall, freezes may protect the holdings of big whales and prevent a flash crash for BTC if someone is able to hack wallets. But in the short term, some see BIP-361 as breaking the underlying BTC ethos of avoiding censorship and asset freezes.

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