Matt Corallo: Most crypto wallets are quantum-safe, Bitcoin’s soft fork could require proof of seed phrase ownership, and the Ethereum Foundation is leading in quantum threat response

Key takeaways

• Most crypto wallets use quantum-safe derivation schemes for seed phrases, enhancing security against quantum threats.
• A soft fork could be implemented in Bitcoin to require proof of seed phrase ownership, addressing potential quantum threats.
• Identifying relevant Bitcoin developers is challenging due to noise from less impactful contributors.
• Organizations like Chaincode Labs and Blockstream Research are crucial in advancing post-quantum security for Bitcoin.
• The Bitcoin community may adapt to post-quantum challenges faster than anticipated.
• There is a forming consensus among Bitcoin developers on approaches to address quantum threats.
• Preparing Bitcoin for a post-quantum world may be easier than expected, despite higher data requirements.
• Current post-quantum cryptographic schemes are in early stages and may not be reliable yet.
• Quantum computing poses a significant threat to all cryptographic protocols, including Bitcoin.
• The Ethereum Foundation is taking a more proactive approach to quantum threats compared to Bitcoin.
• Bitcoin may take seven years to upgrade to a post-quantum state, but proactive steps are being taken now.
• The public perception of quantum threats may pose a greater risk to Bitcoin than the actual technological threat in the short term.

Guest intro

Matt Corallo is a Bitcoin Core contributor at Chaincode Labs. He is a co-founder of Blockstream and the creator and maintainer of the Fast Internet Bitcoin Relay Engine (FIBRE).

Quantum-safe measures in crypto wallets

• “Most crypto wallets use derivation schemes that are quantum safe” – Matt Corallo
• Seed phrases in wallets enhance security against quantum threats.
• A soft fork could require proof of seed phrase ownership to combat quantum threats.
• “We could do a soft fork in Bitcoin and require proof of seed phrase” – Matt Corallo
• Understanding wallet security mechanisms is crucial for future-proofing against quantum computing.
• Quantum-safe measures are already integrated into many crypto wallets.
• The implications of quantum computing on wallet security are significant.
• Adapting to quantum threats doesn’t necessarily require extensive wallet upgrades.

Identifying relevant Bitcoin developers

• “It can be hard to tell who’s relevant in Bitcoin development” – Matt Corallo
• Noise from less impactful contributors complicates identifying key developers.
• Organizations like Chaincode Labs focus on post-quantum security.
• “Chaincode Labs has spent time on mapping out a post-quantum future for Bitcoin” – Matt Corallo
• Understanding the dynamics of the Bitcoin development community is crucial.
• The distinction between impactful and non-impactful contributors is essential.
• Engaging with the right developers is critical for stakeholders.
• The Bitcoin community is preparing for post-quantum challenges.

Consensus and roadmap for post-quantum Bitcoin

• A consensus is forming among developers on addressing quantum threats.
• “There’s a consensus forming in terms of approaches” – Matt Corallo
• Preparing Bitcoin for a post-quantum world may be easier than expected.
• Higher data requirements are a consideration in preparing for quantum threats.
• “Bitcoin core developers are conservative about data requirements” – Matt Corallo
• A roadmap to address quantum threats is gaining consensus.
• The technical feasibility of adapting Bitcoin is optimistic.
• Developers are actively working on post-quantum security measures.

Challenges and opportunities in post-quantum cryptography

• Current post-quantum cryptographic schemes are in early stages.
• “Post-quantum schemes are still fairly young” – Matt Corallo
• Hash-based signatures allow gradual transition without immediate reliance.
• “You can start using addresses that commit to post-quantum hash-based signatures” – Matt Corallo
• Integrating new cryptographic methods is a strategic approach.
• The reliability of current post-quantum schemes is under evaluation.
• A gradual transition to post-quantum cryptography is possible.
• Bitcoin’s security measures are evolving to address future threats.

Quantum computing’s impact on cryptographic protocols

• Quantum computing poses a significant threat to cryptographic protocols.
• “A quantum computer could keep plans secret, leaving holders vulnerable” – Matt Corallo
• Ethereum is more proactive in addressing quantum threats than Bitcoin.
• “The Ethereum Foundation has a group dedicated to working on this” – Matt Corallo
• The threat of quantum computing requires immediate attention.
• Differing strategies between Ethereum and Bitcoin highlight contrasting approaches.
• Quantum threats are a critical risk in the blockchain space.
• Proactive measures are essential to mitigate quantum vulnerabilities.

Transitioning to post-quantum public keys

• The transition to post-quantum public keys involves community consensus.
• “You have to flip that switch, it’s up to the community” – Matt Corallo
• Cryptocurrencies face similar challenges as other cryptographic systems.
• “There’s not much unique about any crypto in this decision” – Matt Corallo
• Community consensus is crucial for accepting old public keys.
• The decision-making process involves complex considerations.
• The broader industry issue of quantum security affects all cryptographic systems.
• Transitioning to post-quantum security is a shared challenge across industries.

Market dynamics and Bitcoin forks

• The market will prefer forks that disable insecure spend paths.
• “The market is gonna prefer the fork with insecure spend paths disabled” – Matt Corallo
• Market forces determine the value and fate of crypto.
• “It’s up to the market, not consensus among all stakeholders” – Matt Corallo
• The role of market dynamics is critical in crypto forks.
• Developers prioritize principles like censorship resistance.
• “Contributors focus on principles rather than specific constituencies” – Matt Corallo
• Bitcoin’s development is guided by foundational principles.

Trustlessness and quantum threats

• Trustlessness is a key focus for Bitcoin developers.
• “Trustlessness is the right answer for Bitcoin development” – Matt Corallo
• Quantum computing threatens Bitcoin’s trustlessness.
• “A quantum computer stealing coins impacts trust in the system” – Matt Corallo
• User confidence is tied to the system’s trustlessness.
• Developers prioritize user autonomy and security.
• Ongoing security considerations are necessary for Bitcoin.
• Quantum threats challenge the core principles of Bitcoin.

Bitcoin’s competition for capital

• Bitcoin faces competition from new investment classes like AI.
• “Bitcoin is competing for capital with AI, a new investment class” – Matt Corallo
• Short-term price movements are not a priority for developers.
• “Developers focus on principles, not short-term price” – Matt Corallo
• Market dynamics could favor forks with lower supply.
• “Forks with lower supply might win in market dynamics” – Matt Corallo
• The investment landscape shift impacts Bitcoin’s performance.
• Developer priorities differ from market price fluctuations.

Cryptographic risks and mitigation strategies

• Traditional mathematical breakthroughs could threaten cryptography.
• “There’s a risk of traditional breakthroughs leading to cryptographic issues” – Matt Corallo
• Requiring multiple signature schemes can mitigate risks.
• “Require two different signature schemes to ensure security” – Matt Corallo
• Cryptographic vulnerabilities evolve progressively over time.
• “Cryptographic primitives aren’t broken overnight” – Matt Corallo
• Proactive measures are necessary to address cryptographic risks.
• The blockchain community is considering technical solutions to complex problems.