Digital asset manager CoinShares has downplayed fears that quantum computing could destabilize the Bitcoin market, suggesting that only a small portion of Bitcoins are vulnerable to such a threat. According to Christopher Bendiksen, CoinShares' lead researcher on Bitcoin, a mere 10,230 Bitcoin (BTC) out of 1.63 million are stored in wallets with cryptographic keys exposed to quantum attacks.
Bendiksen explained that over 7,000 of these Bitcoins are in wallets containing between 100 and 1,000 BTC, while approximately 3,230 Bitcoins reside in wallets with balances ranging from 1,000 to 10,000 BTC. These Bitcoins, valued at $719.1 million at current market rates, could be compromised by quantum computers, but Bendiksen likened such an attack to a typical market trade.
The vast majority, totaling 1.62 million Bitcoin, are held in smaller wallets with less than 100 BTC. Bendiksen asserted that even under the most optimistic technological advancements, it would take a thousand years to crack each of these wallets using quantum computing.
The concern stems from quantum algorithms like Shor’s, which could potentially break Bitcoin’s elliptic-curve cryptography, and Grover’s, which might weaken the SHA-256 encryption. Nonetheless, Bendiksen emphasized that these algorithms cannot alter Bitcoin’s fixed supply of 21 million coins or its proof-of-work consensus, which are core aspects of the network.
Recent concerns about quantum computing have fueled fear, uncertainty, and doubt (FUD) in the Bitcoin community, with critics cautioning that a breach in cryptography could jeopardize the network that supports $1.4 trillion in assets.
The Bitcoins in question are linked to unspent transaction output (UTXO) wallets, many of which trace back to the early days of Bitcoin. This situation has sparked debate within the community about whether to adopt a quantum-resistant hard fork or to continue as is.
Prominent figures like Michael Saylor, executive chairman of Strategy, and Adam Back, CEO of Blockstream, argue that concerns over quantum computing are exaggerated and pose no immediate threat to Bitcoin. Bendiksen agrees, noting that breaking Bitcoin’s cryptography would require millions of fault-tolerant qubits, a capability far beyond current technology demonstrated by Google’s quantum computer, Willow.
While some, including Charles Edwards of Capriole Investments, view quantum computing as a looming danger, advocating for proactive measures to enhance security, others believe that Bitcoin will remain secure for the foreseeable future. Proposed solutions include adopting post-quantum cryptographic signatures, as suggested by Blockstream researcher Jonas Nick.
This ongoing discussion highlights the contrasting views on Bitcoin’s resilience in the face of emerging quantum technologies.