Bitcoin’s current market stability may be deceptive, masking a growing concern among analysts regarding the cryptocurrency’s vulnerability to advances in quantum computing. While a full-scale quantum attack remains years away, the potential for disruption is already prompting a reassessment of Bitcoin’s valuation, with some predicting a significant price correction if proactive measures aren’t taken.
Charles Edwards, founder of Capriole, recently issued a stark warning: without a swift move towards quantum-resistant code, Bitcoin’s value could be halved within the next year. In a report published on February 20, 2026, Edwards outlined a “Quantum Discount Factor” that could see Bitcoin’s price plummet to around $30,000 from its current level of approximately $68,000. His analysis suggests a potential 75% discount by 2029 if the network fails to address the looming threat.
However, Edwards also argues that Bitcoin is currently undervalued, estimating a fair valuation of $120,000, which would fall to $96,000 when accounting for quantum risk. This suggests that addressing the quantum threat isn’t simply about preventing a price collapse, but also about unlocking potential upside. He believes that for long-term investors optimistic about a solution within the next 2-3 years, the current price presents an attractive opportunity.
The core of the concern lies in Bitcoin’s reliance on ECDSA cryptography. A sufficiently powerful quantum computer, utilizing Shor’s algorithm, could theoretically derive private keys from public ones, compromising the security of Bitcoin wallets and potentially allowing for the theft of funds. While such a computer doesn’t exist today, forecasts suggest a “cryptographically relevant quantum event” is increasingly likely by 2030, with a 60% probability, and probable by 2031, with an 80% probability.
The issue isn’t solely a technological one. Edwards emphasizes that the challenge is as much about governance and coordination within the Bitcoin ecosystem as It’s about hardware. Even if quantum computers become a threat, migrating users to quantum-resistant wallets and code could take two to three years, creating a window of vulnerability. This lag between the development of quantum computing capabilities and the Bitcoin network’s ability to adapt is driving the current “discount factor.”
This concern is no longer confined to the crypto community. BlackRock, in an amendment to the prospectus of its iShares Bitcoin Trust ETF, explicitly warned that advances in quantum computing could render Bitcoin’s cryptography ineffective, potentially compromising wallet security and necessitating network-wide changes. The firm cautioned that there’s no guarantee these transitions would be implemented successfully or on time.
The potential financial impact is substantial. Edwards estimates that 20% to 30% of the Bitcoin supply is “public key exposed,” including older output types and dormant coins. CoinShares’ February 2026 assessment focuses on legacy Pay-to-Public-Key (P2PK) outputs, equivalent to roughly 1.6 million BTC (approximately 8% of the total supply). While the amount of BTC at immediate risk of disruption is smaller – around 10,200 BTC in UTXOs large enough to significantly impact the market – the potential for a forced supply shock remains a serious concern.
The Bitcoin community is responding. A draft proposal, BIP 360, has been submitted to the Bitcoin Improvement Proposals repository, introducing Pay-to-Merkle-Root (P2MR), a soft fork output type designed to reduce long-term quantum risks and prepare for future post-quantum signature integration. However, BIP 360 is presented as a first step, acknowledging that full protection may require post-quantum signatures.
Edwards suggests a more drastic measure – a “dead man’s switch” concept where coins not migrated to quantum-resistant outputs within a defined timeframe could be frozen. While this could preserve network value, it clashes with Bitcoin’s core principle of individual control over funds and could undermine confidence in its “hard money” thesis. Successfully implementing such a solution would require broad consensus, a historically challenging feat within the Bitcoin community.
The debate surrounding quantum computing and Bitcoin is evolving. The focus is shifting from whether a quantum attack is possible to when it might occur and how effectively the Bitcoin network can adapt. For investors, the key question is not simply whether quantum computers pose a threat, but whether Bitcoin can demonstrate sufficient progress towards a solution to prevent quantum risk from further depressing its valuation. The market is beginning to price in this uncertainty, and the coming years will be critical in determining Bitcoin’s long-term resilience.
