Under what BitMEX calls the "canary watch state," old coins would remain spendable as long as no one drains the canary fund.
Crypto News
BitMEX Research has put forward a soft fork proposal that would avoid a blanket freeze of quantum-vulnerable dormant coins unless a quantum computer is first proven capable of stealing funds. The proposal, shared on Thursday, offers an alternative to BIP-361, a Bitcoin improvement proposal introduced earlier this week that called for freezing dormant, quantum-exposed coins outright.
The BitMEX approach centers on a "canary fund," a special address constructed using a cryptographic method called a Nothing-Up-My-Sleeve Number, or NUMS. The private key for this address is unknown, making it mathematically valid but effectively unspendable under current computing conditions. Any actor with a sufficiently powerful quantum computer could theoretically spend from it.
Users would be able to donate funds to this address as a bounty, creating a financial incentive for any quantum-capable actor to trigger the alarm by spending from it. If a spend from the canary address is detected, the freeze would activate automatically, confirming that the quantum threat has crossed from theoretical to operational.
Under what BitMEX calls the "canary watch state," old coins would remain spendable as long as no one drains the canary fund. Participants in the fund can use multisignatures and withdraw their holdings at any time. The proposal also includes a safety window that would allow quantum-vulnerable transactions to proceed after BIP-361's proposed five-year mark, but with outputs temporarily locked.
"While this approach adds complexity and risk, given how controversial any coin freeze is, mitigating the impact of the freeze using this type of system may be worth consideration," BitMEX Research said.
BIP-361 drew immediate pushback from the Bitcoin community after its publication on Tuesday. Co-author Jameson Lopp addressed the reaction on X on Wednesday, describing the proposal as "a rough idea for a contingency plan" rather than something ready for activation.
"I know folks don't like it. I don't like it myself. I wrote it because I like the alternative even less," Lopp wrote. He told Cointelegraph the proposal was a "rough sketch" to address the risk of a circulating supply shock if quantumcomputing advances to the point where a post-quantum signature scheme gains consensus for inclusion in Bitcoin's protocol.
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