Blockstream Research, the company’s research arm co-founded by Adam Back, announced on March 3 that it broadcast the first transaction signed using a post-quantum signature method on its sidechain, Liquid Network (side chain) Bitcoin.
According to the Blockstream team, the implementation of this scheme is No need to change Liquid consensus rules: It was made possible thanks to Simplicity, the smart contract language used in its network.
In this case, I was able to use Simplicity to build it. Post-Quantum Signature Verifier full (a program that mathematically verifies that a transaction has been approved with a new encryption scheme) and integrates it directly into the terms and conditions for using funds on Liquid.
This means users have the possibility to lock in their funds within the contract. Just accept and release the post-quantum signatureThe rest of the network does not need to adopt the changes.
The implemented encryption scheme is called SHRINCS and was developed in-house by Blockstream and optimized for the constraints of chains such as Bitcoin.
Unlike the post-quantum standard published by the National Institute of Standards and Technology (NIST) in 2024 and validated by the international cryptographic community after years of review, SHRINCS is a development announced by Blockstream in December 2025, pending external validation.
A step towards liquid rather than Bitcoin
Blockstream’s proof suggests that complex post-quantum cryptography can be efficiently verified within Bitcoin’s own computational constraints.
The next step is to introduce Simplicity into the base layer, which represents an architectural challenge. Smart contracts do not run directly on Bitcoin. To run them, Bitcoin needs to include a virtual machine (a computing environment integrated with the protocols that interpret and execute these types of programs) This does not exist in today’s main networks.
Implementing this will require an extensive consensus process among developers, but no formal proposal or date has been set.
What does Blockstream Advanced protect and what does it not protect?
Protection developed by Blockstream applies to:
- LBTC token, wrapped Bitcoin (wrapped bitcoin) in liquid.
- Stablecoins and tokenized assets issued on that network.
However, the statement itself details that this advancement does not cover aspects of Liquid that remain protected by traditional cryptography.
- mechanism of peg, A bridge that connects Bitcoin to Liquid and supports LBTC value. If Bitcoin is also not quantum shielded, this bridge will also be affected.
- Liquid consensus protocol.
- Confidential assets, digital assets natively issued and traded on Liquid.
Blockstream claims to be working on solutions for these components, but no dates or additional details have been disclosed.
moreover, Two operational limitations It is mentioned without underlining in the statement.
First, SHRINCS scheme I haven’t completed my security audit yet Independent standard conditions must be met before a cryptographic implementation can be recommended.
Secondly, there is no wallet yet that allows that. Ordinary users use this protection. This library is available on GitHub for developers, but is not integrated into end-use products.
Bitcoin base layer also evolves
While Blockstream is working on Liquid, the developer community is also working on the Bitcoin mainnet.
As reported by CriptoNoticias, on February 11, the BIP-360 proposal entered the discussion and auditing process to be added to the base layer after being incorporated into the Bitcoin repository.
BIP-360 proposes a new type of address called Payment to Merkle Root (P2MR). Hide the public key from the user before they are used and displayed on the network.
In its current form, the public key is published on a chain, which enables sufficiently powerful quantum computers. Get your private key and access your funds.
P2MR attempts to neutralize that risk by keeping the keys hidden. under hash while funds are stationaryrevealing only the information necessary when making a transaction.