Onchain analyst and early Bitcoin supporter, Willy Woo, has raised concerns about the growing impact of quantum computing on Bitcoin's long-term valuation compared to gold. Woo suggests that the potential threat from quantum advancements is causing markets to reconsider Bitcoin's standing against gold.
In a recent social media post, Woo discussed the concept of "Q-Day," when a sufficiently advanced quantum computer could potentially compromise current public key cryptography. This scenario could bring back into circulation approximately 4 million "lost" Bitcoins, whose private keys are thought to be irrecoverable. Such a development would challenge Bitcoin's scarcity narrative.
Woo estimates a 25% chance that the Bitcoin network might agree to freeze these coins through a hard fork, a highly debated governance topic. The 4 million at-risk coins represent about 25%-30% of the total Bitcoin supply, held in addresses with publicly visible keys, making them prime targets in a quantum attack.
The potential move to freeze these coins could disrupt fundamental Bitcoin principles like fungibility, immutability, and property rights. It could create divisions between those advocating for backward-compatible fixes and those open to rule changes to safeguard early balances.
With a 75% chance that these coins will remain untouched, Woo suggests investors should consider the possibility that an amount equivalent to "8 years of enterprise accumulation" could become spendable. This scenario is already influencing Bitcoin's valuation, projecting a structural discount against gold for the next five to 15 years.
Despite these concerns, Bitcoin developers and cryptographers believe there is no immediate "doomsday" threat. They propose a gradual transition towards new address formats and key management practices to address quantum challenges.
Even if quantum breakthroughs occur sooner than anticipated, some experts, like Alex Gladstein of the Human Rights Foundation, argue that these coins might be accumulated by a nation-state rather than flooding the market.
Willy Woo's warning emerges as Bitcoin's value sits significantly below its all-time high, and quantum risks have become a mainstream consideration in institutional portfolios. Earlier this year, Christopher Wood of Jefferies adjusted his model portfolio by replacing Bitcoin with gold, citing the potential impact of quantum computing on Bitcoin's store-of-value proposition.