Dragonfly partner rejects ‘bunker mode’ doomerism, calls for proactive blockchain measures

Dragonfly’s managing partner, Haseeb Qureshi, called Ethereum researcher Justin Drake’s “bunker mode” warning “cryptographic doomerism,” and said migrating tokens to fresh addresses was not a real solution against the threat of artificial intelligence breaking cryptographic signatures.

“Bunker mode” would only protect investors’ coins as long as they weren’t moved from the fresh address, wrote Qureshi in a Thursday X post, adding that these coins would be “worthless if all of the other coins are being hacked and mass-sold.”

Instead, Qureshi urged blockchain networks to adopt proactive measures to protect users against the event of AI breaking cryptographic signatures. He proposed a “Cryptographic Recovery Mode,” a hash-based backup signature plan that users could map to their addresses, enabling validators to force recovery if cryptographic signatures were broken.

The possibility of AI models or quantum computers breaking cryptographic signatures may threaten more than 31% of the Bitcoin supply, as 6.26 million Bitcoin (BTC) currently sit in vulnerable addresses, according to Glassnode.

Of the 6.26 million BTC, about 4.33 million are exposed because of address reuse; moving these coins to a fresh address would end the exposure. Another 1.94 million BTC are exposed through their address format, wrote Glassnode co-founder Rafael Schultze-Kraft in a Thursday X post.

Share of BTC supply with exposed public keys. Source: Rafael

Of the total exposed supply, nearly 1.8 million BTC are held on cryptocurrency exchanges, with a total of 57% of all exchange balances currently exposed.