Asset manager Ark Invest said quantum computing is a long-term consideration for Bitcoin’s security, but is not an immediate threat.
In a report co-authored with Unchained on Wednesday, the investment manager said today’s quantum computers are far below the power needed to break Bitcoin’s encryption, which relies on elliptic curve cryptography to ensure the security of wallets.
“Today’s quantum systems lack the capabilities needed to compromise Bitcoin,” writes author Dhruv Bansal, co-founder and CSO of Unchained. Tom Honzik, Director of Custodial Research at Unchained. David Puel, Research Trading Analyst and Associate Portfolio Manager for Digital Assets at Ark Invest.
Even if quantum systems eventually reach that level, the risks are likely to materialize over time and result in high costs for attackers, the report said.
One of the main reasons Bitcoin does not face an immediate threat is that major advances in quantum computing are likely to disrupt broader internet security first, prompting a coordinated response from governments, technology companies, and financial institutions before reaching Bitcoin.
The report comes amid concerns from long-term investors that advances in quantum computing could one day crack Bitcoin’s underlying encryption, increasing speculation about a potential security crisis.
Earlier this year, Christopher Wood, a prominent portfolio strategist at Jefferies, said investors should reduce their Bitcoin allocation by 10% and add gold instead, citing quantum threats. The move spooked investors and spooked the digital asset market.
35% of supply is at risk
Although researchers largely agree that such capabilities are still far from reality, the prospect that powerful quantum machines could eventually crack private keys and old wallet formats has raised concerns among investors about the long-term risks to Bitcoin and the broader digital asset ecosystem.
Quantum Threats to Bitcoin Wallets (Ark Invest)
The Ark report estimates that around 35% of Bitcoin’s supply is in address types that are theoretically exposed to future quantum attacks, including approximately 1.7 million addresses. $BTC Approximately 5.2 million people are estimated to have been lost. $BTC You may be able to move to a more secure wallet.
One of those wallets, about 1 million $BTCbelongs to Satoshi Nakamoto, the founder of the Bitcoin network.
However, rather than a sudden “Q-day,” Ark Invest sees these advances unfolding in several different stages over many years. Some investors fear the first attack could occur before 2030, while others suggest it could be “decades away,” the report said.
Staged Quantum Threat (Ark Invest)
The report claims that either scenario would likely give the Bitcoin community time to upgrade the network with quantum-resistant cryptography and allow users to migrate their coins to a more secure address format.
“The good news is that we already know how to protect ourselves from quantum attacks,” the report says.
“The majority of Bitcoin’s supply is held in quantum-resistant addresses, the rest in quantum-vulnerable addresses, and should not be at risk until Stage 3 of the timeline, when there is a CRQC that can crack 256-bit ECC keys.”
The world’s largest cryptocurrency was trading at around $70,000 at the time of publication of this article.
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