Coinbase, Holding 5% of All Bitcoin, Calls for Quantum Upgrade to Start Now
October 14, 2026
Bitcoin’s Biggest Custodian Says the Clock Is Already Running
Coinbase has backed one of the most uncomfortable conversations in crypto. In a blog post published on October 13, the exchange laid out what it wants from Bitcoin’s move to quantum-resistant cryptography and argued that preparation cannot wait for a quantum computer to appear.
The timing matters because of who is talking. According to CoinDesk, Coinbase holds roughly 5% of all Bitcoin in existence on behalf of clients, including banks, asset managers and hedge funds. When the firm responsible for that much of the supply says the network needs to change, developers tend to listen.
“Bitcoin consensus changes and ecosystem migrations can take years, so it is important that we begin this work now,” Coinbase wrote.
What Coinbase Is Actually Asking For
The post is not a single proposal. It is a checklist of what a complete upgrade would need to achieve, according to The Block.
Coinbase says any serious plan must protect both old and newly created funds, fit within Bitcoin’s limited block space, keep ordinary computers able to validate the chain, work with institutional custody systems, support everyday wallets, and offer a credible path for coins that cannot or will not move.
That last point is the hardest, and Coinbase deliberately split it off from the rest. The firm wants to proceed with the technical work on new signatures now, while the debate over lost and dormant coins runs on a separate track.
Why Quantum Computers Threaten Bitcoin Wallets
Every Bitcoin wallet has two parts. The public key is like a letterbox address, visible to anyone. The private key is the only thing that can open it, and it is what signs transactions.
Today’s computers cannot work backward from a public key to the private key. That is the whole foundation of Bitcoin’s security. A sufficiently powerful quantum computer, often called a cryptographically relevant quantum computer or CRQC, could in theory do exactly that, and drain any wallet whose public key is visible on the chain.
Nobody has built such a machine. CoinDesk notes that Google researchers have suggested one could exist by 2029, though estimates vary widely. Coinbase says the exact date is beside the point: “We believe it is important to begin preparing well ahead of any CRQC announcement,” the post said.
A Flexible Container, Not a One-Time Rebuild
Coinbase’s central technical request is flexibility. It wants Bitcoin’s new output designs to separate the “container” that holds funds from the signature scheme that unlocks them, so that signature methods can be added, swapped, or combined later without rebuilding the system again.
The firm points to two candidates that appear to offer this. One is Pay-to-Merkle-Root, proposed under BIP-360, a draft from developers Hunter Beast, Ethan Heilman and Isabel Foxen Duke that removes the quantum-vulnerable key path from Taproot-style outputs. The other is a construction known as P2TRv2.
Coinbase also backs a staged approach. One example it gives is a 1-of-2 setup, where the same coins can be spent with either a traditional key or a post-quantum key. Active wallets could adopt that hybrid protection early, before the network settles the final rules for older signature types.
The Hard Question of Lost and Dormant Coins
A significant share of Bitcoin sits in old wallets whose owners lost their keys years ago, and many of those coins use address types that already expose their public keys. If a quantum machine arrived in secret, those coins would be the first target, and Coinbase warns that an attacker could drain them “before the public learns.”
Coinbase takes no position on what should happen to those coins. It insists that any rescue mechanism must be quantum-safe, or thieves could exploit it.
That echoes an argument the community has been having all year. Digitap covered the BIP-361 plan to freeze quantum-vulnerable coins in April, a proposal that split developers over whether Bitcoin should ever block a valid signature.
Why Institutions Care About Stateless Signatures and MPC
Two of Coinbase’s requests look technical but come down to risk management for large holders.
Some post-quantum signature schemes are “stateful,” meaning the wallet must track every signature it makes so it never reuses one-time keys. A restored backup or a failed save could cause reuse, letting an attacker forge a signature. Coinbase wants a stateless option available alongside any stateful one.
The firm also wants at least one quantum-safe scheme that works with multi-party computation, or MPC, where a key is split across several parties so no single holder can move funds. “When implemented effectively, MPC can provide strong protection against key theft,” Coinbase said, calling it “an important layer of defense for large organizations that face constant attacks on their infrastructure.”
What Happens Next for Bitcoin’s Quantum Debate
Nothing changes on the network today. Bitcoin was trading near $83,000 on Wednesday, and the post had no visible effect on crypto prices.
Bitcoin’s developers hold the practical next steps. BIP-360 remains a draft, and any soft fork would need broad agreement among miners, node operators and wallet makers before activation. If the community does move toward a hybrid signature model, exchanges and custodians could begin migrating client funds well before legacy signatures are restricted, which may be the outcome Coinbase is positioning for.
If quantum hardware advances faster than expected, the window for a calm migration could narrow quickly, which is precisely why Coinbase is pressing to begin the design work now, before a deadline.
A Custodian’s Voice Changes the Weight of the Debate
Quantum risk has mostly been argued by researchers and independent developers. The StarkWare test transaction in August and the BIP-361 freeze proposal in the spring both came from the community’s technical edge.
Coinbase is different. It is a regulated custodian holding about one in every twenty Bitcoins, and many investors judge it as the best crypto exchange for institutional access. Its statement that Bitcoin “will continue to be the most trusted cryptocurrency in a post-quantum world” is optimistic framing, but the post’s substance is a warning: the upgrade will take years, and those years have to start somewhere.
Whether BIP-360 or a rival design wins, the quantum question has moved from a theoretical concern to an item on the agenda of one of the network’s largest holders.
Share Article
Madiha Riaz
Madiha is a seasoned researcher in cryptocurrency, blockchain, and emerging Web3 technologies. With a background in organic chemistry and a sharp analytical mindset, she brings scientific depth to decentralized innovation. Since discovering crypto in 2017 and investing in 2018, she’s been uncovering and sharing deep insights into how blockchain is redefining the digital asset landscape.
