Bitcoin developers have introduced BIP-361, a draft proposal aimed at bolstering the security of hundreds of billions of dollars in Bitcoin by addressing future risks posed by quantum computing. This initiative seeks to reduce the vulnerability of Bitcoin wallets whose public keys have been exposed on the blockchain, potentially safeguarding a significant portion of the cryptocurrency’s total supply.
Background and Quantum Computing Threats
BIP-361, officially titled “Post Quantum Migration and Legacy Signature Sunset,” was authored by Jameson Lopp and a team of five collaborators, and received formal designation on February 11, 2026. The proposal arrives as the Bitcoin community considers long-term security against theoretical attacks by quantum computers, which have the potential to reverse-engineer private keys from public ones.
A Bitcoin wallet’s susceptibility originates when its public key becomes visible on the blockchain. Though quantum computers powerful enough to exploit this have not yet materialized, concerns focus on the risk that malicious actors could collect public keys now with the intention to exploit them when relevant quantum capabilities are available—a strategy referred to as “harvest now, decrypt later.”
On March 1, 2026, more than 34% of the entire Bitcoin supply had public keys openly exposed, placing those funds at elevated potential risk.
Bitcoin’s core cryptography is based on elliptic curve techniques, which make it infeasible for classical computers to derive private keys. However, if quantum computing scales further, Shor’s algorithm—a method introduced in 1994—could theoretically make public-to-private key inversion possible.
Mini dictionary: Shor’s algorithm—a quantum computing algorithm formulated by Peter Shor that can quickly factor large numbers and break cryptographic systems based on integer factorization or elliptic curves, such as those used in Bitcoin.
Phased Rollout and Key Initiatives
The proposal details a gradual, multi-stage adoption strategy. In Phase A, it would block new Bitcoin transactions to addresses considered quantum-vulnerable, allowing for a grace period of 160,000 blocks—approximately three years—after activation. This gives users considerable time to migrate funds before restrictions are enacted.
Subsequently, Phase B would permanently invalidate legacy cryptographic signatures five years from the initial trigger point, formally retiring outdated protection methods. The technical implementation of Phase C is still under discussion and could introduce a zero-knowledge proof recovery mechanism connected to modern seed phrase standards.
During the proposal’s review, Jameson Lopp acknowledged the merits of BIP-361 as a more practical option compared to alternatives, while emphasizing that further research is needed before moving forward.
Zero-Knowledge Recovery and Project Eleven
Separate from BIP-361, cryptocurrency research group Project Eleven has engineered a zero-knowledge proof system designed for wallet recovery scenarios. This solution enables a wallet holder to demonstrate cryptographic control over higher-level keys in the derivation hierarchy, without revealing private information, and operates in just 243 milliseconds on typical consumer hardware.
Such advancements could allow users who retain their BIP-39 seed phrases to unlock funds that might otherwise be lost due to obsolescence or vulnerability.
Mini dictionary: Project Eleven—a cryptocurrency research initiative developing cryptographic proofs and solutions for blockchain security and wallet recovery beyond traditional methods.
However, this approach does not extend to Satoshi Nakamoto’s roughly 1.1 million Bitcoin, which were mined prior to the introduction of the BIP-32 standard for hierarchical wallets in 2012. As a result, these coins remain inaccessible using Project Eleven’s current solution.
| Phase | Action | Timeline |
|---|---|---|
| Phase A | Freeze new transfers to vulnerable addresses | ~3 years after activation |
| Phase B | Invalidate legacy cryptographic signatures | ~5 years after activation |
| Phase C | Potential zero-knowledge proof recovery | Under discussion |
Current Market Sentiment
At the time the proposal was circulated, Bitcoin was trading near $64,492. The market’s Fear and Greed Index stood at 28, reflecting a prevailing sense of caution among investors.
