Against Allowing Quantum Recovery of Bitcoin

In a thought-provoking exchange on the Bitcoin Development Mailing List, a unique perspective was offered regarding the handling of quantum-vulnerable Bitcoin outputs. The discussion delved into the ramifications of freezing these outputs as opposed to outright confiscation or burning. The proposed approach suggested limiting transactions from quantum-vulnerable inputs (e.g., P2PK inputs) to only allow them to produce similar quantum-vulnerable outputs. This method doesn't confiscate assets but creates a distinct division within Bitcoin's ecosystem, segregating quantum-vulnerable coins from their quantum-resistant counterparts.

This segregation essentially renders the quantum-vulnerable coins valueless in a scenario where quantum computing poses a real threat. These vulnerable coins would not be accepted by miners for transaction fees, nor by exchanges, and likely would be shunned in general commerce due to the inherent risk of theft via quantum hacking. The premise is that the value of these quantum-vulnerable coins has already been compromised by the mere existence and potential application of quantum computing technology. They cease to function as a secure form of property and instead become a potential inflationary force, rewarding those who possess quantum computing capabilities with the ability to exploit these vulnerabilities.

The conversation further highlighted that some of these quantum-vulnerable outputs might demonstrate ownership through BIP-39 HD Seed proofs, offering a layer of protection. By freezing these outputs rather than allowing them to be stolen, the network can provide a form of security that minimizes loss without directly confiscating assets. This approach aims to protect the integrity and value of quantum-resistant Bitcoin outputs, safeguarding the cryptocurrency from the inflationary pressures that an unchecked quantum attack could introduce.