Wall Street broker Bernstein said the rise of quantum computers poses a credible but manageable threat to Bitcoin and the broader crypto ecosystem, as recent breakthroughs compress timelines for potential attacks on modern cryptography.
Advances such as Google Quantum AI’s reported reduction in qubit requirements suggest the risk is no longer a distant, decades-long concern, the broker noted. Still, the firm cautioned that scaling quantum systems to the level needed to break widespread encryption remains a complex, multi-step challenge.
“Quantum should be viewed as a medium to long-term system upgrade cycle rather than a risk,” analysts led by Gautam Chhugani said in the Wednesday report.
Quantum computing uses the principles of quantum mechanics rather than classical physics. Instead of binary bits, it relies on qubits that can exist in multiple states at once, a property known as superposition that allows many possibilities to be processed simultaneously.
Combined with entanglement, this enables quantum systems to solve certain problems, such as breaking encryption, far more efficiently than classical computers.
Quantum computers could eventually weaken cryptographic systems like elliptic curve cryptography, which underpins crypto-wallets, by solving problems beyond the reach of classical machines. However, the report said the threat spans industries from finance to defense and should be seen as a manageable long-term risk rather than an existential risk to Bitcoin.
Exposure is concentrated in around 1.7 million BTC in older, “legacy” wallets, while newer practices and protocols reduce vulnerability. Bitcoin mining, which relies on SHA-based hashing, remains effectively secure even in advanced quantum scenarios, the broker said.
Bernstein expects the crypto industry to have sufficient time, around three to five years, to transition to post-quantum cryptography, with upgrades such as new wallet standards, reduced address reuse and key rotation already under discussion.
A recent academic paper said that attacking the Bitcoin blockchain through quantum mining would require the energy output of a star.
Read more: Attacking bitcoin mining with a quantum computer would require the energy of a star, academics say
