EU financial watchdogs warn quantum computing poses imminent threat to blockchain encryption
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Summary
European financial regulators, including the European Supervisory Authorities (ESAs), warned that advanced quantum computers could eventually break the cryptography securing blockchains, putting about 6.9 million Bitcoin, worth roughly $586 billion, at risk. Older or reused Bitcoin addresses are especially vulnerable because their public keys are visible on the blockchain, allowing quantum computers to derive private keys. The European Commission urges member states to begin post-quantum security transitions by the end of 2026.
Why it matters
The warning signals that quantum computing could threaten the security of blockchain assets earlier than the technology’s commercial viability might suggest. This poses a significant risk to Bitcoin holders with legacy addresses and raises urgent questions about how to update blockchain security, which requires network-wide consensus and cooperation from coin holders. It highlights the potential for “harvest now, decrypt later” attacks on encrypted data.
Key context
Bitcoin’s security depends on cryptographic signatures, and unlike traditional banking systems, blockchain security updates require agreement across the network. Some Bitcoin outputs still protect public keys behind cryptographic hashes, reducing exposure, but older pay-to-public-key or reused addresses have public keys visible on-chain, making them more vulnerable. The European Commission plans to protect high-risk use cases with post-quantum security measures by 2030.
Key numbers and entities
The European Supervisory Authorities (ESAs), including the European Banking Authority (EBA), European Securities and Markets Authority (ESMA), and European Insurance and Occupational Pensions Authority (EIOPA), issued the warning. Approximately 6.9 million Bitcoin, valued at about $586 billion, are noted as vulnerable. The European Commission is coordinating a post-quantum transition timeline targeting 2026 and 2030.
What remains unclear
The report does not specify when a quantum computer capable of breaking Bitcoin’s cryptography will actually exist. It also leaves uncertain how the Bitcoin community will achieve the required network-wide consensus for adopting quantum-resistant signatures or what practical steps holders of vulnerable coins must take. No direct timeline for the commercial viability of quantum computing is included in this warning.