As quantum computing moves from theory toward application, a long-running assumption at the heart of Bitcoin — that its cryptography is effectively unbreakable — is being questioned anew by market veterans and technologists alike.
A Warning From the Mainstream
In a recent note to investors, Chris Wood, the global head of equity strategy at Jefferies, raised a concern that has long circulated on the fringes of cryptography and computer science but is now edging closer to the center of financial debate: Bitcoin’s security, he argued, may be intact only until it is decrypted.
Writing from Mumbai in his newsletter Greed and Fear, Mr. Wood framed the issue not as an imminent collapse but as an existential vulnerability tied to advances in quantum computing. He said the arrival of cryptographically relevant quantum computers — often referred to as CRQCs — could undermine the assumptions that make Bitcoin function as a secure digital asset.
On the back of that assessment, Mr. Wood said he had removed Bitcoin from his model portfolio, replacing the allocation with gold and gold-mining stocks. The shift, he suggested, reflected not a judgment on Bitcoin’s recent performance but a reassessment of long-term risk.
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How Bitcoin’s Security Works
Bitcoin’s design rests on asymmetric cryptography. A public key allows anyone to receive Bitcoin, while a private key — known only to the owner — is required to move or spend it. The mathematical relationship between the two is deliberately one-way: deriving a public key from a private key is straightforward, but reversing that process is computationally prohibitive.
With classical computers, that asymmetry is effectively absolute. Mr. Wood noted that even the most powerful supercomputers would take trillions of years to derive a private key from a public one using brute force.
That imbalance is central to Bitcoin’s security model. As long as private keys remain secret and computationally unreachable, ownership is protected by mathematics rather than by institutions.
The Quantum Question
Quantum computing, however, threatens to alter that equation. CRQCs, if they become viable at scale, could dramatically reduce the time required to reverse cryptographic functions that are currently considered secure.
Mr. Wood wrote that what now takes trillions of years could, in a quantum context, potentially be reduced to hours or days. Such a shift would not merely weaken Bitcoin’s defenses; it would call into question the core idea that digital scarcity and ownership can be guaranteed through existing cryptographic methods.
The risk, he argued, is not confined to future coins. Bitcoins whose public keys are already exposed on the network particularly older coins could, in theory, become vulnerable to theft if quantum capabilities advance far enough.
This possibility has prompted ongoing debate within the Bitcoin community about whether “quantum-vulnerable” coins should be pre-emptively rendered unusable, or “burned,” to preserve the system’s overall integrity.
Store of Value Under Strain
Beyond the technical mechanics, Mr. Wood focused on what he described as a deeper issue: Bitcoin’s identity as a store of value. Bitcoin’s supply schedule — a pre-programmed, steadily tightening issuance that will end with the final coin mined around 2140 — is often cited as its defining feature, likening it to digital gold.
Any credible threat to that quantitative tightening, Mr. Wood argued, is potentially existential. If ownership can no longer be guaranteed with confidence, the concept of Bitcoin as a secure alternative to gold is weakened, regardless of how distant the threat may appear.
He acknowledged that the Bitcoin ecosystem has adapted before. Rule changes and “forks” have altered the network in the past after intense internal debate. Proponents of pre-emptive action, he noted, argue that modifying the system to address quantum risks would be consistent with those precedents.
