ARK Invest: 35% of Bitcoin Supply at Quantum Risk, But Governance Slows Fix

ARK Invest Quantifies <a href="https://jpykr.com/btc-usd/">Bitcoin</a>’s Quantum Risk – Developers Say the Real Problem Is Governance

Key Takeaways

ARK Invest’s white paper identifies ~6.9 million BTC (roughly 35% of supply) as theoretically vulnerable to future quantum attacks due to exposed public keys.
The threat is classified as a long-term engineering problem, not an imminent crisis – most experts place “Q-Day” in the mid-2030s at the earliest.
BIP-360 is the Bitcoin community’s current proposed fix, but implementing it requires network-wide consensus – a process that could take years.
Capital rotation into AI, not quantum fear, is the more immediate driver behind Bitcoin’s 2026 price weakness, according to developer Matt Corallo.

Quantum computing has long been considered a potential future risk to cryptocurrencies. Now, ARK Invest’s recent actions are drawing more immediate attention to this threat.

A new report from ARK Invest, created with Bitcoin firm Unchained and shared by Benzinga, estimates that around 6.9 million Bitcoin – about 34.6% of all Bitcoin in circulation – could be at risk from future quantum computers. The report, titled ‘Bitcoin and Quantum Computing,’ is gaining attention from industry experts because it provides a more precise understanding of this potential threat than previous analyses, though it doesn’t suggest an immediate risk.

Ark Invest Warns 35% Of Bitcoin Supply Could Face Future Quantum Risks, But There Is Time To Adapt.

— Benzinga (@Benzinga)

What Makes These Coins Vulnerable

The main problem centers around Bitcoin’s public keys. Currently, for the majority of Bitcoins, these keys are kept hidden using a complex code until the Bitcoin is actually spent. A powerful quantum computer, if built, could potentially crack this code and figure out the private key from a public key – but only if it can first *see* the public key.

ARK has found three ways in which Bitcoin keys are already publicly visible. The most significant is through address reuse – about 5 million BTC currently resides in wallets where the key became exposed when funds were sent and then returned to the same address. Another 1.7 million BTC comes from the earliest Bitcoin addresses (known as Pay-to-Public-Key or P2PK), including those linked to Satoshi Nakamoto, where the key has always been visible on the blockchain. Finally, around 200,000 BTC uses a specific Taproot feature called the “key path” which reveals the key when the funds are spent.

This doesn’t mean these cryptocurrencies are currently at risk of being stolen. However, if quantum computers become powerful enough, these coins would likely be the first ones hackers would try to steal.

What That Threshold Looks Like

According to ARK’s calculations, cracking a Bitcoin public key would need around 2,330 powerful quantum bits (qubits) and a huge number of quantum operations. This level of quantum hardware doesn’t exist yet. Today’s quantum computers aren’t accurate enough to reliably carry out such a complex attack.

The report suggests that widespread encryption breaking – often referred to as “Q-Day” – won’t happen until at least the mid-2030s. Vitalik Buterin, a co-founder of Ethereum, estimated in late 2025 and early 2026 that there’s only about a 20% chance of a significant advancement in quantum computing before 2030. Despite this, he’s been actively encouraging major blockchain networks to prepare for the possibility.

A more important development might be happening with the physical building blocks of quantum computers. PsiQuantum, a company based in Chicago, is expected to finish a facility with one million qubits by 2027. It’s still unclear if these will be powerful enough to break current encryption, but this shows the technology is moving beyond just theory and becoming a reality.

BIP-360 and the Governance Problem

Bitcoin developers are aware of potential risks and are taking steps to address them. At the same time as the release of the ARK white paper, they formally proposed BIP-360 – an update to how Taproot transactions work. This proposal introduces a new “Pay-to-Merkle-Root” (P2MR) system. P2MR removes the option for direct key-based spending, requiring all transactions to go through a script path and keeping sensitive public key information off the blockchain.

ARK believes that Bitcoin will eventually need to upgrade its security to withstand the potential threat of quantum computers. This means adopting new encryption methods like ML-DSA or SLH-DSA, which are designed to stay secure even with the power of quantum computing.

However, Bitcoin’s way of making changes poses a significant challenge. Unlike typical software or even Ethereum, Bitcoin upgrades need widespread agreement from miners, those who run the network, and developers. Experts say that even if a solution to the quantum computing threat is found, actually implementing it could take almost ten years due to the complex coordination required.

Three Schools of Thought on What Happens Next

Responses to the ARK report have fallen into expected camps, but each viewpoint has at least some valid reasoning supporting it.

Those who believe Bitcoin will thrive, like Michael Saylor, suggest that quantum computing won’t harm it. Instead, they believe the network will adapt. Users will move to addresses protected from quantum attacks, and older, vulnerable bitcoins – often from lost wallets or held by Bitcoin’s creator – will become unusable. This would reduce the total supply of Bitcoin, making it more scarce and secure.

Some experts believe Ethereum might gain an advantage over Bitcoin in the face of quantum computing threats. Because Ethereum is developing defenses against these threats more quickly, large institutional investors – who are already very focused on security – could start moving their money into Ethereum instead of Bitcoin. This shift could potentially lead to Ethereum surpassing Bitcoin in value, a scenario some refer to as a “flippening.”

Another group, frequently found among developers, completely rejects the idea that quantum computers pose a unique threat to Bitcoin. They argue that if a quantum computer *could* break the encryption Bitcoin uses, it could also break the encryption that protects everything from online banking to government secrets and vital infrastructure. In that scenario, the problems with any single blockchain – like Bitcoin – would be minor compared to the widespread chaos that would ensue. This idea, often called the “meteor argument,” suggests that quantum computing isn’t a crypto issue, but a potentially catastrophic problem for society as a whole.

Corallo’s Warning: Quantum Is Becoming a Convenient Scapegoat

Bitcoin developer Matt Corallo recently voiced strong concerns, in a February 2026 appearance on the Unchained podcast, that the potential threat of quantum computing is being misused. He argues people are incorrectly using it to explain unrelated market fluctuations, and his worry isn’t actually about the quantum threat itself.

Corallo argues that if investors truly believed a major security threat from quantum computing was imminent, Ethereum should be doing better than Bitcoin. This is because Ethereum is more adaptable and has more ongoing research into protecting against such threats. However, both cryptocurrencies have significantly decreased in value from their highs, indicating that something other than quantum computing concerns is causing the price drops.

According to Corallo, the recent downturn isn’t due to quantum computing, but rather a shift of investment capital towards artificial intelligence. Both Bitcoin mining and AI require the same limited resources – specialized computer chips, reliable power sources, and physical space – and investors are now prioritizing AI infrastructure over cryptocurrency, leading to a sell-off across the crypto market.

According to Corallo, a real threat from quantum computing is likely 10 to 20 years away, or even further. He isn’t saying there’s no risk, just that there’s no need to panic about it right now.

What to Watch

A key indicator in the short term is the progress of BIP-360 as it goes through the approval process with Bitcoin developers and miners. Whether it’s adopted or not will show how concerned the network’s participants are about potential long-term risks. Additionally, PsiQuantum’s planned completion of its facility in 2027 will be a crucial test of hardware development – the difference between the number of physical qubits and the number of useful, secure logical qubits is the biggest unknown factor in predicting when quantum computers could pose a threat.

ARK Invest’s recent report has successfully shifted the conversation from general worries about Bitcoin to concrete data. Now, whether the Bitcoin community responds quickly enough to address those findings is a matter of decision-making and coordination, not technical limitations. Historically, these kinds of decisions have been the biggest bottleneck for Bitcoin’s progress.

This article is for informational purposes only and shouldn’t be considered financial, investment, or trading advice. Coindoo.com doesn’t support or suggest any particular investment or cryptocurrency. Before making any investment choices, be sure to do your own research and talk to a qualified financial advisor.

2026-03-17 12:17