Key facts
- Coinbase custodies approximately 5% of all Bitcoin.
- Coinbase advocates for a flexible container design like BIP-360 for easier post-quantum algorithm integration.
- A staged, hybrid approach, such as a 1-of-2 construction, is favored for gradual migration of active wallets.
- Coinbase stressed the need for post-quantum schemes compatible with multi-party computation (MPC) for institutional custody.
- The Bitcoin Security Consortium, co-founded by Coinbase, BlackRock, Strategy, and ARK Invest, aims to fund quantum security research.
Coinbase has issued a strong warning to the Bitcoin community, urging immediate preparations for a transition to quantum-resistant cryptography. The exchange, a major custodian of Bitcoin, published a detailed position paper emphasizing that the multi-year process of upgrading consensus mechanisms, wallets, and ecosystem coordination requires proactive engagement.
In its blog post, Coinbase author Shashank Agrawal detailed technical priorities. A key recommendation is a flexible output design that separates the transaction container from the signature scheme, allowing for the integration of new post-quantum algorithms without a complete protocol overhaul. The exchange pointed to BIP-360 (P2MR) and P2TRv2 as potential building blocks. For existing wallets, Coinbase advocates for a staged, hybrid approach, such as a 1-of-2 construction, enabling users to spend funds using either classical or post-quantum keys for a gradual migration.
Coinbase also highlighted critical concerns for institutional custody, stressing the necessity for post-quantum schemes compatible with multi-party computation (MPC). This follows the exchange's earlier revelation that it was developing post-quantum custody solutions for approximately $250 billion in institutional assets, including those linked to BlackRock, after identifying MPC incompatibility as a significant gap.
The exchange's call to action aligns with growing industry momentum and regulatory urgency. In July 2026, Coinbase co-founded the Bitcoin Security Consortium with BlackRock, Strategy, and ARK Invest, committing $15 million over three years to quantum security research. Regulators, including the EU, have flagged post-quantum migration as a systemic risk for crypto, and Europol has identified wallets as a primary vulnerability.