The BIP-361 draft outlines a staged transition that would ultimately render certain legacy outputs — particularly those with exposed public keys — unspendable unless users migrate to quantum-resistant alternatives.

Per the proposal, more than a third of bitcoin in circulation has exposed public keys, which creates a sizable attack surface if quantum capabilities reach a critical point.

The authors warn that such an attack could unfold quietly, with stolen coins moved only after a delay to avoid detection.

Multi-phase approach

At the center of the proposal is a time-bound overhaul of Bitcoin’s signature schemes.

In its first phase, the network would block new transactions that attempt to send funds to vulnerable address types.

A later phase would go further, invalidating transactions that rely on existing ECDSA and Schnorr signatures entirely, effectively freezing funds that have not been upgraded.

The authors argue that early Bitcoin outputs, including pay-to-public-key (P2PK) addresses, carry heightened risk because their public keys are already visible onchain.

If left unchecked, this could allow sufficiently advanced quantum computers to derive private keys and seize funds, according to the details shared via GitHub.

Rather than waiting for that moment, the proposal introduces a fixed migration window spanning several years. During this period, the plan would aim to force upgrades across wallets, exchanges, and custodians.

A potential recovery path for stranded funds, likely built around zero-knowledge proofs tied to seed phrases, is also under discussion.

Quantum debate

The whole approach stands out for its rigidity. By design, it removes optionality.

Fail to upgrade, and access to funds becomes increasingly restricted, before eventually being cut off.

This hard line lands in the middle of a widening split over how urgent the quantum threat really is.

Earlier this year, Benchmark analysts characterized the risk as distant and manageable, pushing back against rising alarms.

However, the tone shifted in March after Google suggested practical quantum attacks could arrive sooner than previously expected, with a tentative transition window around 2029.

Google’s warning set off a fresh wave of debate across the ecosystem.

Some researchers described the update as a turning point for Bitcoin’s long-term security model, while others urged caution against overstating near-term risks.

Bernstein analysts have since cast the issue as a standard upgrade cycle rather than an existential threat. Michael Saylor, Strategy’s executive chairman and a major bitcoin evangelist, also dismissed concerns as overblown, arguing the network has time to adapt.

The BIP-361 proposal also enters a growing field of technical responses. Last week, a StarkWare researcher outlined a separate path to quantum-safe transactions that would avoid a soft fork altogether, underscoring a lack of consensus on how best to proceed.

Notably, Bitcoin has historically moved slowly on protocol changes, often taking years to coordinate across its decentralized stakeholders.

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