CoinShares says only 10,200 BTC face real quantum risk, pushing back on 'overblown' estimates

Bitcoin's quantum computing vulnerability has been overstated and is not an urgent crisis but a foreseeable engineering challenge, according to a new report from digital asset manager CoinShares published Friday.

The report by CoinShares bitcoin research lead Christopher Bendiksen takes direct aim at higher-end exposure estimates that have fueled recent institutional concern. A widely referenced May 2025 study from Chaincode Labs researchers Anthony Milton and Clara Shikhelman estimated that 20% to 50% of all bitcoin in circulation could be vulnerable to quantum-enabled key extraction. CoinShares contends those figures lump together categories of exposure with vastly different practical implications.

CoinShares narrowed the scope to legacy Pay-to-Public-Key (P2PK) addresses, where public keys are permanently visible on-chain. The firm estimated roughly 1.6 million BTC, about 8% of total supply, sits in these addresses. But only about 10,200 BTC are held in addresses large enough to cause any "appreciable market disruption" if compromised, CoinShares said.

The remaining coins are spread across more than 32,000 individual UTXOs averaging around 50 BTC each, which the report said would take an extraordinarily long time to crack even in highly optimistic quantum scenarios. Claims of 25% vulnerability, CoinShares argued, often include temporary risks like exchange address reuse that can be easily mitigated.

Jefferies' Christopher Wood cited the higher Chaincode Labs estimates when he eliminated his model portfolio's entire 10% bitcoin allocation in January, describing quantum risk as an "existential" threat to Bitcoin's store-of-value thesis, The Block recently reported.

"While GREED & fear does not believe that the quantum issue is about to hit the bitcoin price dramatically in the near term, the store of value concept is clearly on less solid foundation from the standpoint of a long-term pension portfolio," Wood wrote.

Today's quantum computers are vastly underpowered

CoinShares dismissed the notion that the threat is anywhere near imminent. Citing published research, Bendiksen noted that reversing a public key within one day would require a fault-tolerant quantum computer with 13 million physical qubits, roughly 100,000 times the capacity of the largest machine in existence. Breaking a key within an hour would require a system approximately 3 million times more capable than today's hardware.

"To break current asymmetric cryptography, one would need something in the order of millions of qubits," Ledger CTO Charles Guillemet told CoinShares. "Willow, Google's current computer, is 105 qubits. And as soon as you add one more qubit, it becomes exponentially more difficult to maintain the coherence system."

The report also waded into a polarizing governance debate. Prominent voices including cypherpunk Jameson Lopp have argued for burning quantum-vulnerable coins through a soft fork. CoinShares took the opposite view, arguing that burning coins whose owners may simply be inactive would violate Bitcoin's property rights guarantees.

"I find the very idea of burning coins that are not your own squarely contradictory to Bitcoin's ethos," Bendiksen wrote in a companion report from last August.

The firm also cautioned against rushing to adopt quantum-resistant address formats before they are fully proven, warning that premature implementation risks critical bugs and wasted development resources. Instead, CoinShares endorsed a gradual transition. Cryptographer Adam Back told CoinShares that Bitcoin "can adopt post-quantum signatures" and "continue evolving defensively."

The report lands at a turbulent moment. Bitcoin has lost roughly half its value from its October 2025 peak above $126,000, currently trading around $70,400 after briefly dipping below $61,000 earlier this week, according to The Block's Bitcoin Price page. CoinShares' own weekly flow data showed $1.7 billion leaving crypto investment products last week, The Block previously reported.

Investment in quantum preparedness continues to accelerate nonetheless. Project Eleven recently raised a $20 million Series A at a $120 million valuation to build post-quantum tools for crypto networks, The Block reported in January. Strategy executive chairman Michael Saylor, meanwhile, dismissed quantum concerns on a recent earnings call as part of a "parade of horrible FUD."

On the Ethereum side, co-founder Vitalik Buterin has spoken out on how the blockchain should tackle emerging quantum threats, and the Ethereum Foundation recently formed a dedicated post-quantum security team. "We should resist the trap of saying 'let's delay quantum-resistance until the last possible moment in the name of eking out more efficiencies for a while longer,'" Buterin said. 

For institutional investors, CoinShares argued, "quantum risks are contained, with an extended timeline for resolution."