Latest advances in quantum computing reignite long-standing concerns about Bitcoin .
Bitcoin analyst James Check said that in theory, a sufficiently powerful cryptography-related quantum computer could break Bitcoin’s elliptic curve signatures, exposing coins with visible public keys, especially wallets from the early Satoshi era.
Quantum doomsdayers warn that this will unleash massive amounts of supply and cause markets to collapse. The numbers suggest otherwise.
The threat of quantum computing is unquestionable.
Approximately 1.7 million BTC are held in Satoshi Nakamoto era addresses, in which case these addresses may be vulnerable to attack. At current prices, potential selling pressure is about $145 billion, which sounds catastrophic but is actually manageable.
During a bull market, long-term holders (investors who have held Bitcoin for at least 155 days) typically allocate 10,000 to 30,000 BTC per day. At this rate, the entire Satoshi era supply is equivalent to about two to three months of typical profit-taking. During the recent bear market, more than 2.3 million Bitcoins changed hands in a single quarter, exceeding all quantum “targets” and without a systemic collapse.
Additionally, monthly exchange inflows are close to 850,000 BTC. The derivatives market cycles through a notional volume equivalent to the entire Satoshi Nakamoto reserve every few days. What seemed huge in isolation becomes relatively mundane when compared to Bitcoin’s existing liquidity and turnover.
Sudden, focused release is still important. That could exacerbate volatility and potentially trigger a prolonged downturn, Cheek said. But even this scenario assumes economically irrational behavior. Any participant with the ability to acquire such treasures will be incentivized to allocate it gradually, possibly hedging via derivatives, to minimize slippage and maximize returns.
The Bitcoin market typically absorbs supply of the same order of magnitude as P2PK-era coins. The time range is in months, not years.
The real problem is not mechanical selling pressure. This is governance. The bigger issue may be freezing Satoshi coins via BIP-361 and then letting everything proceed as it should.