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Bitcoin will likely be an immediate target the moment developers can break modern cryptography with quantum computers, billionaire venture capitalist Chamath Palihapitiya says.
Palihapitiya said on an April 3 episode of the “All-In” podcast that Bitcoin is “a very visible and obvious honeypot” amid the looming quantum computing threat.
“A nonstate actor’s incentive will first be to drain the obvious honeypots and then tell everybody that it’s broken so that then everything goes to s–t all the prices go to zero, and then they have all the money and then they can buy stuff,” he said.
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According to Palihapitiya, the Bitcoin community likely only has five to seven years to prepare for this outcome. He warned that quantum computing could render cryptocurrencies obsolete, likening it to the impact AI advances are having on software-as-a-service businesses. “You can’t have both,” he said.
Palihapitiya said Bitcoin changed its cryptography in its early days but suggested that such a change would likely be more difficult now.
“The difficulty here is you’re talking about a big technological lift,” he said. “You’re talking about all the wallets being rearchitected. You’re talking about all the transactional flows, all the processing nodes. These are complicated things that need to happen.”
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Palihapitiya’s remarks come after Google last month set 2029 as the timeline for its post-quantum cryptography migration, which put the urgency of Bitcoin’s migration in focus.
Some cryptocurrency investors are concerned that Bitcoin may not be able to migrate in time due to its decentralized nature and lack of established governance, which can make coordination difficult.
There are about 14 million exposed Bitcoin wallets with holdings worth nearly $484 billion at risk of a quantum attack as of April 7, according to cryptocurrency-focused quantum computing security company Project Eleven.
As concerns around risks like quantum computing emerge, some investors are focusing on diversification rather than concentrating heavily in a single asset. Platforms like Public offer access to stocks, ETFs, and cryptocurrencies, allowing individuals to build more balanced portfolios across different asset classes.