Cardano (CRYPTO: ADA) founder Charles Hoskinson warned that the quantum threat to Bitcoin (CRYPTO: BTC) is arriving faster than anticipated as 11 major companies passed the first gate in DARPA’s quantum benchmarking initiative.

The Timeline Is Accelerating

DARPA brought together 11 companies from IBM to Quantinuum through a three-stage process to determine whether functional quantum computers arrive by 2033 and whether they can break encryption. 

Within the next 12 to 24 months, the industry will know if this is a near-horizon problem or something for the 2040s or 2050s.

Ethereum (CRYPTO: ETH) developer Justin Drake previously says there’s at least a 10% chance of quantum computers breaking crypto by 2032. 

He recently revised that estimate forward after observing progress in neutral atom computing.

“The quantum threat is real and it’s coming much faster than everybody is anticipating,” Hoskinson told the Paul Barron Network.

Bitcoin’s Hard Fork Dilemma

Bitcoin faces three options, none of them clean. The first is doing nothing, which leaves about 6.8 million coins vulnerable and makes all future spending problematic. 

The second is BIP 360, which adds post-quantum protection but allows old coins to be stolen. 

The third is BIP 361, which freezes legacy accounts and creates a migration path, but it can’t work for 1.7 million coins because the BIP 39 standard didn’t exist when Bitcoin launched in 2009.

Charles Hoskinson said that the most likely outcome is BIP 360, where Bitcoin adds post-quantum signatures but accepts that attackers will steal coins in old addresses.

The problem is that large holders like BlackRock (NYSE:BLK) won’t accept 20% of supply getting seized by nation states and dumped on the market. They have fiduciary obligations and will push for a hard fork to prevent theft.

“People like BlackRock and these other large scale holders who have a massive influence now over Bitcoin are not going to be super comfortable with this concept,” Hoskinson said.

The Technical Reality

Post-quantum cryptography is far less efficient than current systems. A STARK signature runs 40 to 200 kilobytes compared to half a kilobyte for elliptic curves.

Hoskinson noted that proof-of-stake blockchains like Cardano have more work to do than proof-of-work systems because they must also secure VRFs, VDFs, and zero knowledge strategies. 

However, Cardano has been researching quantum threats since 2019 and expects to complete post-quantum upgrades before the end of the decade.

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