Bitcoin and Ethereum researchers have introduced separate proposals addressing the risks posed by quantum computers. Bitcoin’s SHRINCS system offers quantum-resistant signatures while limiting the loss of network capacity.
The Ethereum draft would allow validators to deposit funds using quantum-resistant keys. The network could eventually stop accepting new validators using the existing BLS format.
Both projects remain at an early stage. They require technical reviews and community support before either network can adopt them.
SHRINCS proposed for Bitcoin transactions
Blockstream researchers Jonas Nick and Mikhail Kudinov published the SHRINCS proposal on August 27. The system aims to protect Bitcoin transactions against quantum attacks.
Bitcoin uses digital signatures based on elliptic-curve cryptography to prove ownership. Users can spend their bitcoin without revealing their private keys.
A sufficiently powerful quantum computer could break this protection using Shor’s algorithm. An attacker could calculate a private key from a public key visible onchain.
The attacker could then forge a signature and transfer the bitcoin to another address. The risk primarily concerns addresses whose public keys have already appeared on the blockchain.
Older address formats and wallets that have previously made transactions fall into this category. The estimated 1.1 million BTC associated with Satoshi Nakamoto may also face this risk.
SHRINCS limits the loss of network capacity
Large data requirements create one of the main problems for quantum-resistant signatures. Some systems standardized by the U.S. National Institute of Standards and Technology are dozens of times larger than current Bitcoin signatures.
Larger signatures leave less room for transactions inside Bitcoin blocks. This reduces the number of transfers the network can process each second.
Blockstream estimates Bitcoin could process about 6.5 transactions per second using only Schnorr signatures. That figure could fall to 0.36 transactions with the NIST-standardized SLH-DSA system.
SHRINCS aims to keep capacity at approximately three transactions per second. Its signatures start at 324 bytes and grow by around 16 bytes with each key use.
The proposal’s 580-byte configuration can support roughly three transactions per second. Bitcoin’s existing Schnorr signatures are 64 bytes.
Although SHRINCS signatures start at about five times the size, they do not consume five times more block capacity. SegWit applies a weight discount to the transaction section containing signature data.
The system also relies on SHA-256, which Bitcoin already uses in mining. Its security therefore does not depend on an entirely new mathematical assumption.
SHRINCS is not ready for production
SHRINCS creates a fresh, one-time key for every transaction signature. Wallets must accurately track which keys they have already used.
Records must remain synchronized across phones, hardware wallets and backups. Restoring an older wallet backup could complicate key management.
The researchers have not completed a formal security proof for the system. The reference software has also not undergone a comprehensive security audit.
Blockstream tested SHRINCS-signed transactions on the Liquid network in March. Adding the system to Bitcoin would require a backward-compatible soft fork.
Ethereum prepares to change validator keys
Ethereum researchers published a separate draft one day before the Bitcoin proposal. It would rebuild the deposit contract through which validators join the network.
Validators lock ETH to help secure Ethereum and confirm transactions. The current contract accepts only a cryptographic key format known as BLS.
BLS can combine hundreds of thousands of signatures into a single signature. This feature helps keep Ethereum’s consensus costs manageable.
BLS also relies on elliptic-curve mathematics. A sufficiently powerful quantum computer could potentially forge a validator’s signature.
Ethereum’s existing contract hard-codes the size of BLS keys. The network therefore cannot currently accept quantum-resistant keys of different sizes.
The draft would allow the deposit contract to register different key types. Each deposit would carry a tag identifying its cryptographic system.
BLS keys would use tag zero. Ethereum developers could later introduce additional tags for quantum-resistant systems.
New BLS deposits could be permanently disabled
If Ethereum adopts the proposal, BLS keys would remain operational initially. Alternative signature systems could register through the same contract.
A later upgrade could permanently disable new deposits using BLS keys. Existing BLS validators would remain active, while new participants would need different keys.
Approximately 42.4 million ETH is currently staked on Ethereum. These assets are worth about $104 billion at current prices.
The draft would make the deposit contract more flexible, but it would not complete the migration. Ethereum would also need a separate upgrade explaining how to verify the new signatures.
EIP-8141, currently under consideration for the Hegotá upgrade, proposes a similar transition for user accounts. It would allow accounts to change their transaction authorization system without moving to a new address.
The Ethereum Foundation aims to complete the core protocol changes around 2029. Bitcoin currently has no confirmed implementation timeline for SHRINCS.
