A recently published report from Ark Invest and Unchained sheds light on the implications of quantum computing for Bitcoin, emphasizing that while it poses a potential long-term risk, there is no immediate danger. The research highlights that approximately 35% of the Bitcoin supply might be vulnerable to quantum attacks under specific circumstances, yet the existing quantum technology is not advanced enough to currently threaten Bitcoin’s security.
The report discusses the potential for quantum computing advancements to enable Shor’s algorithm to undermine the elliptic curve cryptography that safeguards Bitcoin wallets. It reassures that current quantum machines lack the necessary power to endanger Bitcoin’s cryptographic foundations. Researchers argue that significant breakthroughs in quantum computing will likely disrupt broader internet security before posing a threat specifically to Bitcoin, allowing ample time for the network to adapt.
According to the report, the evolution of quantum development is expected to be gradual rather than a sudden event, often referred to as a “Q-day.” This gradual progression provides the Bitcoin community time to prepare for any eventual threats stemming from quantum advancements. Key figures in the cryptocurrency space, including leaders from Coinbase and Ethereum, have also begun to recognize and discuss the potential risks associated with quantum computing.
Bitcoin’s security is underpinned by hash functions that secure mining processes and the overall block structure, alongside elliptic curve cryptography that authenticates wallet ownership. However, as quantum technology progresses, concerns arise about possible “harvest now, decrypt later” attacks, where blockchain data could be accumulated now for future exploitation once quantum computers are capable of breaking encryption.
Currently, quantum computers operate in what is known as the “Noisy Intermediate-Scale Quantum” (NISQ) era, typically leveraging around 100 logical qubits. Experts believe that breaking a Bitcoin key would require thousands of high-quality, error-corrected qubits, a feat far beyond current capabilities. Any potential quantum threat to Bitcoin is anticipated to manifest gradually, with researchers projecting that in the next 10 to 20 years, advancements in quantum algorithm research will afford Bitcoin developers the opportunity to optimize the platform against such threats.
Initially, quantum computers are likely to thrive in fields like chemistry before being equipped to break weaker cryptographic systems. Over time, they may gain the ability to challenge the elliptic curve cryptography used in Bitcoin wallets, starting with a slow, meticulous process of breaking individual keys. Eventually, however, they could attain the speed to compromise keys faster than Bitcoin’s typical block interval of roughly 10 minutes.
Despite the slow emergence of the threat, the report indicates that a considerable portion of Bitcoin’s supply remains at risk should quantum technologies eventually break elliptic curve cryptography. Approximately 1.7 million Bitcoin are suspected to be held in vulnerable pay-to-public-key (P2PK) addresses deemed lost, with another 5.2 million BTC in reused or Taproot addresses, collectively constituting about 35% of Bitcoin’s total supply.
To mitigate these risks, the report suggests that Bitcoin developers may need to implement post-quantum cryptography—security protocols designed to resist quantum attacks. Notably, developers have recently merged an update, BIP 360, into Bitcoin’s GitHub repository, which includes a new output type known as Pay-to-Merkle-Root (P2MR). This modification aims to bolster security by disabling certain technical features that expose public keys.
Implementing these protective measures would necessitate alterations to Bitcoin’s consensus rules, a process that requires consensus among the decentralized network of developers, miners, and users. As one cryptographer involved in BIP 360 explained, the extensive ecosystem surrounding Bitcoin—including wallets, hardware devices, and exchanges—will require substantial time for migration and adaptation to new protocols.
While the report acknowledges that Bitcoin’s design inherently complicates major changes, thereby protecting its integrity, this cautious approach could slow the adaptation of necessary upgrades. The balance between adaptability and security will continue to influence Bitcoin’s evolution in the face of advancing technologies.
Discussions surrounding post-quantum cryptographic upgrades are ongoing, and there are still unanswered questions regarding the most effective algorithms and methodologies to integrate into Bitcoin’s framework. As the urgency of the quantum threat escalates, it is expected that development and innovations may gain momentum.
