Quantum Computing Could Affect Bitcoin’s Long-Term Value

Key Highlights:

• Charles Edwards suggests investors may already be pricing a “quantum discount,” valuing Bitcoin about 20% below fair value due to the future risk of “Q-Day”.
• The concern focuses on elliptic curve cryptography, which could be broken by advanced quantum machines within the next decade, prompting forward-looking market adjustments.
• Without timely quantum-resistant upgrades, the discount on Bitcoin’s valuation could widen further, as investors factor in rising probabilities of large-scale cryptographic disruption.

Quantum computing has quickly become one of the threats to Bitcoin’s long-term value. A recent analysis shared by Charles Edwards, founder of Bitcoin and digital asset quant fund Capriole Investments, reveals that the market may already be pricing in a discount linked to the future threat posed by advanced quantum machines. According to Edwards’ analysis, rational investors could be valuing Bitcoin roughly 20% below its fair value today due to what he calls the statistical probability of “Q-Day,” the moment when quantum computers become capable of breaking the cryptography that secures the network.

Quantum Computing : A Threat to Bitcoin’s Future?

The concern focuses on elliptic curve cryptography, which lies at the base of Bitcoin’s wallet security and transaction signatures. Current projections show that within the next decade, quantum systems may reach the level required to break this encryption. Research cited in the report indicates that the probability of this happening could reach 60% by 2030 and 80% by 2031. These estimates are based on rapid advances in qubit development, with  quantum firms reportedly doubling capacity every 18 months.

Edwards argues that markets are forward looking. As a result, investors are already factoring this risk into current prices. The report introduces what it calls a “Quantum Discount Factor,” which adjusts Bitcoin’s fair value based on the likelihood that quantum threats emerge before the network upgrades its cryptography. The current estimate places that discount at 20% for 2026. If development of quantum-resistant solutions does not happen, the discount could rise to 40% next year and 60% the year after.

The analysis further suggests that Bitcoin may have entered a critical phase described as the “Quantum Event Horizon” in 2025. This is the period when the estimated time remaining before Q-Day roughly aligns with the time needed to deploy and activate protocol upgrades across the network. Because Bitcoin operates through decentralized consensus, major technical changes often take years to design, test, and implement.

Market behavior in the past year is cited as supporting evidence. According to Edwards, even with a favorable macro environment that included a post-halving supply reduction and strong global liquidity, Bitcoin recorded its first negative post-halving year and lagged behind traditional assets such as gold and major equity indices. The report links this underperformance to institutional investors adjusting their risk models in response to quantum computing developments.

The paper also touches upon a common belief that traditional banks would be more exposed to quantum threats. It argues that centralized financial systems have more flexibility to upgrade security protocols quickly, freeze accounts, or reverse transactions if needed. Bitcoin’s decentralized structure does not allow for such measures. Edwards also added that a large portion of the total Bitcoin supply is associated with early wallets that have already exposed public keys on-chain. This makes them potential targets if quantum capabilities arrive suddenly.

For security in a post-quantum environment, the network would need to migrate the majority of active coins to new addresses protected by quantum-resistant signatures. This process would need a formal Bitcoin Improvement Proposal and broad agreement among developers, miners, and users. The report notes that no finalized proposal currently exists, even as preliminary technical steps have begun to appear in recent code updates.

Another challenge involves so-called lost or inactive coins. These holdings cannot be moved by their original owners, which raises the risk that a future attacker could gain control of them and release large amounts of Bitcoin onto the market. The report shares several possible ways, including time-based rules that could restrict unmigrated coins after a certain period. However, these measures do remain controversial within the community.

Even with these risks, the report highlights early signs of progress. Developers have started laying groundwork for potential upgrades, and some institutional participants have launched dedicated initiatives to study quantum resilience. But, Edwards stresses that progress on quantum-resistant technology needs to accelerate. 

Also Read: Kevin O’Leary Flags Quantum Computing Risk Amid Bitcoin’s Volatility