Coinbase Prepares for Quantum Future with Post-Quantum Custody Tech

Coinbase is preparing for a post-quantum future in which powerful quantum computers could defeat the cryptography protecting major blockchain networks. The company has formed an Independent Advisory Board on Quantum Computing and Blockchain, which has high confidence that a fault-tolerant quantum computer will eventually be developed. According to Coinbase's Chief Information Security Officer Jeff Lunglhofer, 'A large-scale quantum computer capable of breaking current cryptography will eventually be built. No one knows exactly when.'

The warning does not suggest that quantum computers can currently defeat the cryptography securing major blockchains, but rather that upgrading global blockchain systems and replacing vulnerable cryptographic methods could take years. Coinbase is developing a post-quantum version of its proprietary key management system, PQ-CoreKMS, which protects approximately 99.9% of the assets it holds in custody.

The company will co-host a working session with Stanford in August for Bitcoin Core developers, researchers, and cryptographers to examine potential migration strategies and technical challenges involved in moving bitcoin to quantum-resistant security. Coinbase is also contributing funding and engineers to Bitcoin's wider post-quantum security effort.