European financial supervisors have warned that advances in quantum computing could weaken the cryptography used to secure blockchains. The warning has drawn attention to Bitcoin held at addresses with visible public keys.
CryptoQuant founder Ki Young Ju estimates that 6.89 million BTC could be exposed if quantum machines gain the ability to derive private keys.
The European Banking Authority, the European Insurance and Occupational Pensions Authority, and the European Securities and Markets Authority issued their warning on September 23.
They said quantum computing could weaken systems that protect communications, transactions, databases, and blockchains. The authorities urged financial firms and supervisors to prepare for emerging technology risks.
The supervisors said the threat to cryptography could emerge before quantum computing has commercially viable uses. Their assessment describes a future risk as researchers work to build more capable machines. There has been no reported quantum attack that derived a Bitcoin private key from its public key.
Meanwhile, the European Commission’s roadmap calls for EU member states to start moving to post-quantum cryptography by the end of 2026. It sets the end of 2030 as the deadline for protecting high-risk uses. The plan covers national preparations to protect digital systems, including services that rely on public-key cryptography.
Bitcoin uses public keys to verify transactions. A sufficiently capable quantum computer could use an exposed public key to calculate its private key. An attacker with that key could then authorize a transaction from the affected coins. The timing of such a capability remains uncertain.
Ju estimated that 6.89 million BTC could face future exposure. His figure includes 1.91 million BTC in older pay-to-public-key, or P2PK, outputs, which show public keys on the blockchain. He identified up to 4.98 million more BTC whose public keys may have appeared through earlier transactions.
Ju identified 3.4 million BTC that had remained dormant for more than ten years. That group includes roughly one million BTC linked to Bitcoin’s creator, Satoshi Nakamoto. If Bitcoin adopts new protections, owners would need access to their coins to move them to protected addresses. Coins whose keys are lost could remain where they are.
Protecting exposed Bitcoin would require changes to how the network verifies transaction signatures. Developers would need to prepare and review an upgrade. Miners, node operators, exchanges, wallet providers, and users would then need to adopt compatible software and move affected coins.
The move could place new demands on Bitcoin’s transaction capacity. Post-quantum signatures can be larger than the signatures Bitcoin uses today. Developers would need to weigh their size and performance as they assess possible designs. The network has no central authority that can move coins on behalf of their owners.
Ju also raised the possibility of freezing older coins that remain in exposed addresses. Such a rule would affect owners who later regain access to dormant funds. He said disagreement over those coins could divide participants and create competing versions of Bitcoin.
IBM targets fault-tolerant quantum computing in 2029. Its research roadmap gives Bitcoin participants another timeline to watch as they consider changes to the network’s security.
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