A new cryptographic proposal is drawing attention in the Bitcoin community as concerns grow about the long-term risks of quantum computing. The idea, introduced by researchers linked to crypto investment firm Paradigm, offers a way for early Bitcoin holders, including the network’s creator, to secure their assets without revealing their identity or moving their coins.
The proposal centers on Provable Address-Control Timestamps, or PACTs. It is designed to protect older Bitcoin wallets that could become vulnerable if quantum computing advances enough to break current cryptographic standards.
Bitcoin’s security relies on cryptographic algorithms such as ECDSA, which are considered secure against classical computers. Advanced quantum machines could, in theory, derive private keys from public keys, putting certain Bitcoin addresses at risk.
This issue is more relevant for wallets created before 2012. These early addresses, believed to include those linked to Satoshi Nakamoto, do not benefit from later improvements like hierarchical deterministic wallets, which add extra layers of protection.
Roughly 1.1 million BTC linked to Satoshi, now worth tens of billions of dollars, could be exposed if no protective measures are taken.
One proposed solution, BIP-361, suggests phasing out older addresses by requiring users to move funds into newer, quantum-resistant formats within a set timeframe. This would improve security but creates a trade-off. Long-dormant holders would need to prove control of their wallets to move funds, which could affect privacy and potentially reveal whether Satoshi is still active.
PACTs aim to solve this by allowing users to prove ownership without moving funds or exposing sensitive details.
The process has three stages. In the commitment phase, a wallet owner generates a cryptographic proof showing control over an address. This proof is combined with secret data and timestamped using systems like OpenTimestamps. No on-chain transfer is required.
During the holding period, the proof remains private and is not shared publicly. Even if restrictions are later applied to older addresses, the user retains proof of ownership.
In the final stage, if older wallets are restricted for security reasons, the owner can present a quantum-resistant proof, such as a STARK proof, to regain access. This confirms ownership without revealing wallet details, transaction history, or identity.
This approach allows users to establish proof of ownership now and use it later if needed, while maintaining privacy.
PACTs also address a limitation in earlier proposals. Some recovery methods depend on wallet structures introduced after 2012, leaving older addresses unprotected. PACTs can be applied to these legacy wallets, making them relevant for early adopters and dormant holdings.
The proposal would require major changes to Bitcoin’s infrastructure, including support for verifying STARK proofs on the network. This would likely involve a soft fork and broad consensus from the community. Additional work would be needed to ensure compatibility with wallets and security standards.
There is also a key limitation. PACTs only work if the wallet owner takes action in advance. If private keys are lost, or if the owner is no longer able to act, no solution can be applied later. In that case, the funds would remain exposed to future risks.
The proposal adds to ongoing discussions about how Bitcoin should prepare for quantum threats while preserving decentralization, censorship resistance, and privacy.
