• BTQ Technologies announced the successful deployment of BIP-360 on the Bitcoin Quantum Testnet v0.3.0.
• BIP-360 aims to address a vulnerability associated with Bitcoin's key-path spend mechanism by introducing Pay-to-Merkle-Root.
• The move comes as governments and industry groups step up efforts to future-proof systems from quantum computing risks.

BTQ Technologies announced on Thursday that it has deployed Bitcoin Improvement Proposal (BIP) 360 on its Bitcoin Quantum Testnet v0.3.0, marking the first live implementation of the proposal in a test environment. BIP-360 introduces a quantum-resistant transaction model, Pay-to-Merkle-Root (P2MR).

BTQ launches BIP-360 on testnet, addresses Bitcoin's long-term quantum vulnerability

Although the proposal remains in draft form within the BIP repository, BTQ has built and activated it on the testnet, allowing developers, miners and researchers to test its functionality in practice.

"BIP-360 represents the Bitcoin community's most significant step toward quantum resistance, and we've turned it from a proposal into running code," said BTQ CEO and Chairman Olivier Roussy Newton in a Thursday statement.

The proposal aims to address a long-standing vulnerability in Taproot introduced in 2021. Taproot's key-path spending mechanism can expose public keys on-chain, making them potentially vulnerable to attacks from quantum algorithms such as Shor's algorithm. 

Beyond BIP-360, the Bitcoin Quantum Testnet v0.3.0 contains additional technical updates. These include support for P2MR consensus rules with bc1z address encoding and integration of Dilithium-based post-quantum signature opcodes.

It also features end-to-end testing infrastructure, enabling validation across the entire transaction lifecycle within an active network environment.

The network also features one-minute block times to speed up testing, along with adjustments to signature operation counting and fee structures to accommodate larger post-quantum signatures.

According to BTQ, the testnet has attracted more than 50 miners, processed over 100,000 blocks, and built a community of more than 100 open-source contributors. The current version represents the project's fourth testnet iteration.

Roussy Newton added that the implementation allows developers and institutions to test how quantum-safe Bitcoin transactions could function in real-world conditions.

The development comes as governments and infrastructure stakeholders increase efforts to prepare for the potential impact of quantum computing on cryptographic systems.

In the US, federal agencies face an April deadline to submit post-quantum cryptography transition plans. Meanwhile, the European Union (EU) has set a 2030 target to achieve quantum resistance in critical infrastructure, while Canada has introduced procurement requirements aligned with post-quantum standards, which also take effect in April.

Bitcoin has faced scrutiny lately as investors weigh the potential impact of quantum computing on its cryptographic security. Some experts have suggested that advanced quantum computers could, in the future, break the cryptographic mechanisms used in the Bitcoin network.