- Approximately 3.7 million Bitcoin (20% of total supply) are considered lost and unrecoverable, representing a potential trillion-dollar prize for quantum computing breakthroughs.
- Jameson Lopp, Casa’s co-founder and CSO, strongly opposes quantum recovery of lost Bitcoin, arguing it would constitute wealth redistribution from the technologically ignorant to quantum computer owners.
- Allowing recovery of lost coins would undermine Bitcoin’s foundational principles of immutability, censorship resistance and protocol conservatism, according to Lopp.
Lost Bitcoins are a big problem, especially if you are the one losing them after HODLing for over a decade.
But, the number of lost coins is also staggering, with Chainalysis putting that figure at around 3.7 million BTC or roughly 20% of total supply, lost and not recoverable.
But are these really unrecoverable, or does the threat of quantum computing potentially mean someone will get their hands on them?
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While some argue we are still a long way away from quantum computing posing a threat and that quantum resistant addresses will solve any future issues, others argue that whoever ends up cracking ‘the code’ will be looking at a potential trillion-dollar payday.
So, what should happen to these lost Bitcoins? Co-founder and Chief Security Officer at Bitcoin custody firm Casa, Jameson Lopp, argues strongly against quantum recovery of Bitcoin and for burning any lost coins.
His argument is based on the foundational principles of Bitcoin, including its censorship resistance, immutability and conservatism.
Lopp argues that while quantum computers could eventually become powerful enough to threaten Bitcoin’s security, the technology is not yet at a stage where this is a practical concern.
Allowing Quantum Recovery Would Undermine Bitcoin’s Core Principles, Says Lopp
According to Lopp, Bitcoin’s strength lies in its ability to offer an immutable ledger of transactions, free from interference by any party.
Allowing quantum recovery, writes Lopp, would undermine this by introducing a method through which transactions could be altered or reversed under certain conditions, essentially violating the network’s commitment to immutability.
Allowing quantum recovery of bitcoin is tantamount to wealth redistribution. What we would be allowing is for bitcoin to be redistributed from those who are ignorant of quantum computers to those who have won the technological race to acquire quantum computers.
Jameson Lopp, Casa co-founder Moreover, Lopp argues that such a change would contradict Bitcoin’s principle of conservatism in protocol changes.
The Bitcoin network has traditionally resisted adopting new technologies and changing quickly, adhering instead to a philosophy of making minimal, well-tested enhancements to ensure security and stability.
Introducing quantum recovery could lead to significant and potentially disruptive changes in how the Bitcoin protocol operates.
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Quantum Recovery: Fraught with Risk and Potentially Unfair
Lopp suggests that allowing recovery of lost coins could also be seen as unfair to those who have securely managed their keys. This could lead to broader implications for trust in the system, potentially decreasing the perceived reliability and fairness of Bitcoin.
I, for one, am not interested in rewarding quantum capable entities by inflating the circulating money supply just because some people lost their keys long ago and some laggards are not upgrading their bitcoin wallet’s security.
Jameson Lopp, Casa co-founder Lopp also dismisses the idea from a practical standpoint, arguing that the logistics of implementing quantum recovery are incredibly complex and risky.
The process would require identifying which coins are indeed ‘lost’ and establishing a secure method to recover them without compromising the entire network.
