Quantum computing scares Bitcoin ETF investors

The shadow of quantum computing looms on the Bitcoin market (BTC), generating restlessness among investors. Noah’s Arc Capital Management, a financial firm that until recently maintained a neutral position on Bitcoin ETFs, now recommends selling them, arguing that the market underestimate a technological threat that could change the rules of the game.

In November 2024, Noah’s Arc Capital Management described the Bitcoin ETFs as “maintaining.” However, after evaluating new data, the firm reduced its recommendation to “sell.”

The main reason It is the advance in quantum computing, which could compromise Bitcoin’s cryptographybased on the ECDSA algorithm (Elliptic Curve Digital Signature Algorithm), within 5 to 7 years.

«The market is not considering this risk in the price of Bitcoin. It is a threat that must be evaluated now, ”said the company.

ECDSA’s security depends on the difficulty of solving the problem of elliptical discreet logarithm, a practically impossible calculation for classic computers. However, a quantum computer with the Shor algorithm, developed by Peter Shor in 1994, It could derive private keys from public keys, exposing Bitcoin’s funds to robberiessays the firm.

The impact of the Willow Chip

In December 2024, Google presented its quantum chip «Willow», with 105 cubits, capable of solving in five minutes problems that would take 10 septillions of years, as cryptootics reported.

This advance has advanced the “Q-Day” projections, the moment when quantum computers could break the current cryptographic systems, including ECDSA. Before estimated by 2040, now it is expected that it could occur in 5 to 10 years.

Noah’s Arc points out that more than 60% of Bitcoin’s supply, including the million BTC attributed to Satoshi Nakamoto, is in directions with public keys exposed, vulnerable to quantum attacks. This makes Bitcoin a priority objective.

Challenges for Bitcoin adaptation

The Bitcoin community maintains, in general, that the quantum risk is not immediate and that it would also affect traditional financial systems.

However, Noah’s Arc emphasizes that centralized systems, such as JPMorgan Chase, can be updated rapidly, while The decentralized nature of Bitcoin hinders updates.

To counteract the quantum threat, Bitcoin would need a hard bifurcation towards a quantum -resistant signature scheme. “The transition will be disorderly,” analysts warn, pointing out that The lack of consensus could weaken confidence in digital currency.

A boom in the Bitcoin ETF that challenges pessimism

Despite Noah’s Arc’s concerns, The digital asset market shows a remarkable resilience. Last week he marked a milestone for investment funds in digital assets, with capital flows that reflect a growing interest in the Bitcoin market (BTC) and cryptocurrencies.

These financial products captured 4,390 million dollars. This volume represents the largest weekly entry registered since 2014 and consolidates a streak of 14 consecutive weeks of positive flows, carrying the total accumulated in 2025 to 27,000 million dollars.

In addition, assets under management (AUM) reached a new historical maximum of 220,000 million dollars. This indicates that, far from a generalized “scare”, the market maintains a strong optimism, beyond some exceptions such as the one reported here.

Optimistic perspectives with table solutions

Not everyone shares the pessimistic vision of Noah’s Arc. Michael Saylor, founder of Microstrategy, argues that Bitcoin is based on principles of sovereignty and integrity, beyond its technology.

Adam Back, Blockstream CEO, minimizes Willow’s threat, stating that its 105 cubits do not represent a practical danger for current cryptography. In addition, Back proposes a preventive solution: adopt SLH-DSA, a HASH-based digital signature algorithm, designed by IBM to resist quantum attacks and backed by NIST FIPS 205 standards.

Likewise, Jameson LOPP and other specialists have proposed a soft fork for Bitcoin through the BIP «post quantum migration and legacy signature sunst».

This protocol introduces directions resistant to quantum computing and demands that users migrate their bitcoins manually to a new management format, leaving the ancients obsolete to protect the funds against possible quantum attacks.

Despite these proposals, Noah’s Arc considers that the solutions do not address the urgency of the problem. According to this company, if Bitcoin does not achieve an effective transition towards post -surveying cryptography, ETFs will be unattractive. For now, The firm maintains its recommendation to “sell”although a successful bifurcation could lead to reconsider its position.