Proof of Stake blockchains may face greater quantum computing risks in the future.Attacks because the validator signatures used to secure these networks rely on cryptography, and sufficiently powerful quantum computers could eventually break this cryptography, according to a report released by the cryptocurrency exchange Coinbase.
Coinbase’s Independent Advisory Committee released a report on quantum computing and blockchain on Tuesday, exploring how advances in quantum computing will impact digital asset security.
A spokesperson for Coinbase’s advisory board said, “The best time to prepare for the crypto transition is before it becomes urgent.” Decrypt “We believe customer assets are currently safe, but the industry should not confuse ‘not urgent’ with ‘unimportant.’”
Proof of Stake networks such as Ethereum and Solana rely on cryptographic signatures (Ethereum validators use BLS signatures, while Solana validators and users use Ed25519 signatures) to help the network agree on blocks and maintain consensus.
The advisory committee stated: "Proof-of-stake chains carry risks in the signature schemes used by validators to secure the network. This means that the challenges facing proof-of-stake are not limited to wallet upgrades; some components of the core consensus mechanism may also need to be redesigned."
The report highlights recent work by Ethereum developers, including a proposal introduced by co-founder Vitalik Buterin in February to replace BLS validator signatures, KZG commitments, and ECDSA wallet signatures with quantum-resistant signature alternatives.
Coinbase's independent platform was launched in January. The Advisory Committee on Quantum Computing and Blockchain brought together experts from academia and industry to explore how advances in quantum computing will impact blockchain security and to develop long-term solutions. Committee members include researchers from Stanford University, the University of Texas at Austin, the Ethereum Foundation, Eigen Labs, Bar-Ilan University, and the University of California, Santa Barbara.
The committee also noted that digital signatures used in cryptocurrency wallets represent another major long-term vulnerability. These signatures are used to prove ownership of cryptocurrency and authorize transactions. If these signatures are compromised, attackers can impersonate wallet owners and transfer their funds. Wallets with public keys visible on the blockchain are considered the highest risk. The report estimates that approximately 6.9 million bitcoins fall into this category.
The report states that the current cryptocurrency system remains secure because quantum computers capable of breaking modern cryptographic signatures have not yet been developed. Machines capable of doing so would need to be significantly more powerful than today's quantum systems.
Although much of the discussion about quantum threats focuses on... Bitcoin, the committee stated that, based on current understanding, the core infrastructure of the network—including its mining process, hash functions, and historical ledger—is not considered to have substantial vulnerabilities.
Theoretically, a quantum computer running Grover's algorithm could solve the proof of work puzzle faster than classical computers. However, according to the advisory committee, for the current scale of proof-of-work puzzles, the additional overhead required to run Grover's algorithm on a quantum computer outweighs its theoretical advantage.
Experts warn that migrating blockchain to post-quantum cryptography presents technical challenges, as quantum-safe signatures are significantly larger than current ones, potentially affecting transaction speed, storage, and costs.
Adam Back, CEO of Blockstream, said: "It makes sense to prepare for Bitcoin by enabling people to migrate their keys to a quantum-ready format." Speaking toBloomberg in a recent interview, he added: "The longer Bitcoin users have to migrate their keys to custodians and exchanges so that their Bitcoin can be moved into a quantum-ready format, the safer Bitcoin will be."
The report also addresses how the network should handle wallets that have never been upgraded. Lost keys, inactive accounts, and abandoned wallets mean that certain assets may remain exposed if quantum attacks become feasible.
The advisory board stated: “A quantum computer with practical cryptographic significance still requires major breakthroughs beyond current systems, but upgrading wallets, exchanges, custodians, and decentralized networks is a task that will take years to complete. This is why we chose to release this report now: to ground the discussion in science rather than hype, clarify the actual risks, and help the industry make actionable migration decisions as early as possible.”