Ark Invest Finds 65 % of Bitcoin Supply Practically Safe from Quantum‑Computing Threats
By [Author Name] – [Date]
A white paper released jointly by Ark Invest and crypto‑focused financial services firm Unchained suggests that a significant majority of the world’s Bitcoin holdings are already out of reach of any foreseeable quantum‑computing attack. According to the study, roughly 65.4 % of the total BTC supply is stored in address formats that are not vulnerable to the cryptographic weaknesses that could be exploited by a sufficiently powerful quantum computer. The remaining 34.6 % — roughly 19 million BTC — may still be at risk, according to the authors.
How the Numbers Were Derived
The report breaks down the vulnerable portion of Bitcoin into three categories:
| Bitcoin amount | Approx. % of total supply | Reason for vulnerability |
|---|---|---|
| 5 million BTC | 25 % | Funds held in reused “legacy” addresses that expose the public key after a transaction |
| 1.7 million BTC | 8.6 % | Coins locked in the early Pay‑to‑Public‑Key (P2PK) scripts, which bind funds directly to a public key |
| 0.2 million BTC | ~1 % | Holdings in the newer Pay‑to‑Taproot (P2TR) format, which still retains a key‑path that can be exposed |
The paper estimates that breaking Bitcoin’s elliptic‑curve cryptography (ECC) would require a quantum computer with around 2,330 logical qubits and a massive number of quantum gates (tens of millions to billions). Current experimental devices are far from this capability.
Comparison With Other Analyses
Ark’s exposure figures contrast sharply with a February analysis by CoinShares, which estimated the quantum‑vulnerable share of Bitcoin at roughly 10,200 BTC — about 0.05 % of the total supply. CoinShares’ lower number reflects a more conservative view that only actively spendable coins in vulnerable address types would be at real risk, whereas Ark includes both spent and unspent outputs that could become exposed if the underlying private keys were ever revealed.
Timeline for a Quantum Breakthrough
The white paper outlines a five‑stage roadmap for quantum‑computing progress, with the first three stages posing no immediate danger to Bitcoin. The authors suggest that a quantum processor capable of breaking the 256‑bit ECC keys used in Bitcoin may not appear until the mid‑2030s, a view that aligns with publicly stated targets from major players such as Google, IBM and Microsoft. Even then, the attack would need to be faster than Bitcoin’s 10‑minute block interval to be effective, a threshold not expected to be met until later stages of development.
An additional data point comes from the construction of a 1‑million‑physical‑qubit quantum‑computer facility by PsiQuantum, slated for completion in 2027. While this installation will represent a massive leap in qubit count, physical qubits must still be error‑corrected into logical qubits before they can tackle cryptographic challenges, meaning the facility is unlikely to threaten Bitcoin directly in the near term.
What Bitcoin Might Need to Do
Ark’s authors argue that, as quantum hardware advances, the Bitcoin network will eventually need to adopt quantum‑resistant address formats. They cite post‑quantum cryptography (PQC) schemes such as the lattice‑based ML‑DSA and hash‑based SLH‑DSA signatures as viable options. However, integrating these algorithms would require a consensus‑level change — a soft fork — which is notoriously difficult to achieve in Bitcoin’s decentralized governance model.
One proposal under discussion is BIP‑360, which introduces a Pay‑to‑Merkle‑Root output type intended to reduce exposure by eliminating the key‑path vulnerability in Taproot. While BIP‑360 may mitigate certain attack vectors, critics note that it does not itself incorporate a post‑quantum signature algorithm, leaving a gap in long‑term protection.
Key Takeaways
- Current Exposure Is Limited: About two‑thirds of all BTC is stored in formats (e.g., SegWit, native Taproot) that do not expose public keys, making them effectively immune to quantum attacks with today’s technology.
- Vulnerable Segment Still Large in Absolute Terms: Roughly 19 million BTC could be at risk if a quantum computer capable of breaking ECC were built, though practical exploitation is still many years away.
- Quantum Threat Timeline Extends Into the 2030s: Industry consensus points to a mid‑2030s horizon for quantum processors that could threaten ECC, giving the Bitcoin ecosystem a multi‑year window to develop defenses.
- Post‑Quantum Upgrades Will Face Governance Hurdles: Implementing PQC would likely require a soft fork, demanding broad community agreement—a process that historically takes time.
- BIP‑360 May Reduce Exposure, Not Eliminate It: The proposal offers a stopgap by removing a specific vulnerability but lacks built‑in post‑quantum signatures, meaning further work will be needed.
Outlook
Ark Invest’s analysis underscores that while quantum‑computing remains a “long‑term risk” for Bitcoin, the majority of the supply is already shielded by modern address schemes. Nevertheless, the residual exposure—particularly in legacy P2PK outputs—highlights a need for continued research and a coordinated upgrade path toward quantum‑resistant cryptography. As the quantum hardware landscape evolves, Bitcoin’s developers, miners, and broader community will need to weigh the trade‑offs between security, decentralization, and the practicalities of implementing post‑quantum standards.
Source: https://cointelegraph.com/news/ark-bitcoin-quantum-risk-supply-bip-360?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
