Will Quantum Computing Become a Bitcoin Killer? Experts Classify the Technological Risks of the Coming Decades

Modern cryptography has been the bedrock of Bitcoin’s security for over a decade. However, accelerating advancements in quantum computing are prompting questions about whether future technological breakthroughs could undermine the network’s protections. While today’s quantum computers aren’t an immediate threat, a growing require exists among researchers, developers, and investors to systematically assess the potential risks. At the heart of the debate lies the speed of technological development, the key milestones that would signal a serious threat, and how the network can proactively respond.

The 5-Step Plan: Quantum Progress as a Step-by-Step Process

A recent joint analysis by experts from ARK Invest and financial service provider Unchained – including Dhruv Bansal, Tom Honzik, and David Puell – examines the current state of quantum computing and the prerequisites for compromising cryptographic security. Rather than viewing quantum risk as a sudden event, the white paper analyzes it as a process with identifiable stages of development. By defining clear technological stages and potential warning signals, it’s possible to determine how resilient digital assets are to future technological shifts and which paths are open for timely adaptation.

The model presented divides the progress of quantum computing into five stages. Currently, the technology is in “Step 0” (the NISQ era), where quantum systems exist but lack commercial applications.

“Today’s systems operate in the so-called ‘NISQ era’ – with around 100 logical qubits and a circuit depth in the triple digits – both well below the thresholds required to crack Bitcoin’s elliptic curve cryptography (ECC). This would require at least 2,330 logical qubits and tens of millions to billions of quantum gates,” the authors write.

The transition to Step 1 marks the first commercial breakthrough, where quantum computers solve specific problems in materials science or chemistry. Cryptographic relevance begins with Step 2. In this phase, quantum systems will be able to crack weak keys or outdated security protocols.

“Before a sophisticated CRQC attack can crack Bitcoin’s strong 256-bit ECC encryption, there will be simpler CRQC attacks that attack weaker cryptosystems – those with shorter keys or faulty implementations. CRQC attacks are expected to hit the most vulnerable systems first before moving on to stronger systems like Bitcoin,” the white paper states.

Step 3 represents a significant technological hurdle for Bitcoin. Here, quantum computers could theoretically attack the ECC algorithm protecting private keys. However, this process would still be extremely time-consuming and inefficient.

“Essentially, Bitcoin deposits made before 2011 are quantum safe due to the address type (P2PK) used at the time, while later systems tend to be quantum resistant. The good news is that Bitcoin owners can employ quantum safe addresses in many different wallets and with multiple custody solutions.”

The critical escalation level is reached in Step 4. In this scenario, quantum technology is so advanced that it can extract a private key in less than ten minutes – the average block time for Bitcoin. Without timely protocol upgrades at the post-quantum cryptography (PQC) level, this would pose an existential threat to Bitcoin’s viability as a currency.

“If nothing is done at the protocol level in Step 4, Bitcoin as a usable monetary system is at serious risk – an existential threat to the protocol. For Bitcoin to function as a currency, fully quantum-safe addresses must exist before quantum computers reach Step 4.”

Before Bitcoin comes into focus, weaker encryption systems in industries such as materials science or chemistry would initially be targeted in the intermediate stages. The critical threshold would only be reached in “Step 4.”

Looking into the Future: Three Time Scenarios

The white paper outlines different timelines to make the potential risks to the network more tangible. In a pessimistic scenario, an abrupt technological breakthrough could catch the crypto community unprepared. However, even in this case, the authors emphasize Bitcoin’s survivability, as various proposals for post-quantum cryptography (PQC) already exist and could be implemented quickly to harden the protocol.

Conversely, an optimistic scenario envisions hardware development of quantum computers stagnating due to technical hurdles, giving the Bitcoin ecosystem ample time to research, test, and roll out upgrades without market disruption.

The balanced scenario, aligning with forecasts from leading institutions, places the achievement of the critical development stage 3 within ten to twenty years. The experts at ARK Invest and Unchained believe this timeframe is sufficient to gradually optimize algorithms, virtual machines, and the network’s infrastructure.

Risk Management and Affected Holdings

The report identifies specific vulnerabilities: approximately 35 percent of the total Bitcoin supply is currently in address types theoretically vulnerable to future quantum attacks. Of this, around 1.7 million BTC are likely lost holdings, while another 5.2 million BTC could be migrated to more modern, secure wallet structures. This includes the assets of Bitcoin creator Satoshi Nakamoto.

Despite the attention on quantum advances, the core message remains clear: there is no acute risk for Bitcoin. The technological gap between the current state of research and the computing power required to crack encryption remains substantial. Since the development of defense mechanisms (PQC) is progressing in parallel and sometimes faster, the network is well-positioned to proactively meet future challenges.