Bitcoin Magazine

The Quantum Issue: WTF Is Quantum Computing?

What is quantum computing? How is a quantum computer different from a regular computer? What relevance does this have to Bitcoin?

New Bitcoiners have been inevitably bumping into these questions and having to confront the issues they dredge up regarding Bitcoin’s exposure to what is very much an existential threat to its existence if a viable quantum computer were to be developed. 

The ability to own bitcoin rests on the foundational assumption that without directly leaking a copy of it, no one but the person who possesses a private key can sign to transact with coins secured by that key. Quantum computing calls that assumption into question. 

Quantum computers are not just “computers, but faster.” They function in a very fundamentally different way from a classical computer, and as such they are much more efficient than classical computers at very specific kinds of computations. Now obviously, I’m not going to actually explain how quantum computers work in minute detail within four pages, but I will give you the core intuition of how they are fundamentally different from a classical computer. 

So let’s take a look at how both kinds of computers interact with things like large cryptographic keys. 

Classical Computers

Everything stored in a classical computer (or just computer from here on out) is stored as a series of 1s and 0s. Each bit (1 or 0) is precisely a 1 or 0; there is no ambiguity. When a piece of data is stored, it’s 1s and 0s. When a piece of data is manipulated or modified, it is done bit by bit, step by step, on each 1 or 0. 

That is how a computer works. It linearly, one step after the other, modifies the discrete unambiguous pieces of data that it is storing. It can’t skip ahead, or shortcut (in terms of the steps it’s taking, not more efficient ways to do things mathematically), it has to go through the steps of whatever computation it is doing one by one. 

When you generate a private key using a computer, it acquires a random value (you inputting dice, general user input, randomness from device hardware, etc.) and stores that in memory as 1s and 0s. From there it has to multiply this value by the elliptic curve’s generator point to get a public key. This is accomplished with an algorithm, that boiled down to its most basic level, is literally instructions on what bits to take, how to modify them, what circuits to “push” them down on a physical level to accomplish that, and in the end put the new value that has been modified bit by bit back into memory. 

There are other steps to arrive at an actual valid address, but for the purposes of this article those are not necessary to go into (but they are just like the above step, just step by step instructions on how to modify 1s and 0s in memory). 

So what if someone wanted to use a computer to guess someone else’s private key? 

There are 2²⁵⁶ possible private keys. That’s 115,792,089,237,316,195,423,570,985,008,687,907,853,269,984,665,640,564,039,457,584,007,913,129,639,936 different possible keys. 

A computer would have to try every single one of those possible private keys, one after the other (or however many at a time it can do in parallel), step by step following the exact instructions above for generating keys. The more of them you try to check in parallel, the more computing power you need, with no ability to find any shortcuts around that cost. 

The less computing power you want to use, the more time it will take, the less time you want it to take, the more computing power you need. 

This is an impossible task to accomplish with a computer. On one side you have a computation cost that every computer on Earth is not enough to pay, and on the other side you have a cost in time that is so high every star in the universe would die before you checked them all. 

To actually accomplish your goal, you need another option besides checking one by one linearly or in parallel. That’s where quantum computing comes in.

Quantum Computers

Quantum computers don’t work with discrete states. Everything is precisely a 1 or a 0. The most basic piece of information in a quantum computer is a qubit (the quantum version of a bit). Unlike a bit, a qubit is in a superposition where it is both simultaneously a 1 and a 0. It only settles into one or the other discrete states when it is observed. 

This is one of the key building blocks that allow a quantum computer to compute differently. The other is entanglement. Qubits aren’t just stored in isolation, the physical atoms representing them and collapsing to a discrete state when observed are entangled together. This means when entangled atoms are observed and collapse to a single state, the entangled atoms collapse to the same state, no matter how far apart they are. 

Now here’s where things get weird, and I’m going to have to get a little hand-wavy; you should still walk away with an intuitive understanding of why quantum computers are fundamentally different from a classical computer. An algorithm on a classical computer is a set of instructions to take a specific set of bits, and step by step modify them according to the algorithm’s instructions, until finishing and outputting the finished set of new bits. So the algorithm step by step takes one discrete state and turns it into another. 

Qubits don’t store discrete states until they are observed and collapse to one. They store probabilities. When you have a set of qubits entangled of any given size (like in this hypothetical case 2²⁵⁶), each given possible state that it collapse to has a certain probability of collapsing to that given state. 

Quantum algorithms, rather than being step by step instructions to operate on discrete states, are a set of instructions on how to operate on those entangled qubits in a way that alters the probabilities of different outcomes. Constructive interference is used to increase the probability of a correct outcome, and destructive interference to decrease the probability of incorrect outcomes (note that this is NOT the noise or interference that makes it difficult for physical quantum computers to function accurately, that is a different concept). 

So while a classical computer would have to check each individual private key one by one to find the one matching a specific public key, a quantum computer can simply run a few times using the right algorithm and arrive at the correct answer. It does not do this by “checking all the possibilities at once.” It simply modifies the probabilities of what a superposition will collapse into. 

This is why a quantum computer could break the assumptions underlying elliptic curve cryptography, and a classical computer could not (and it is also why quantum computers are only useful for certain types of computations with a massive possible space of answer candidates to check). 

Don’t Panic

This fundamental difference between classical and quantum computation means, that yes, if a viable quantum computer is actually produced, that functions correctly, then the underlying assumption that secures all Bitcoiners’ individual bitcoin is broken. All of those funds are insecure. 

Yes, this is a serious risk if such a device is actually manufactured, and it works, but we are not entirely unprepared. We understand the problem, we understand the exposure, and a good number of possible solutions to many different facets of the problem are coming together. 

Breathe, and relax. Through the rest of this issue we are going to walk you through the whole problem. 

This piece is featured in the latest Print edition of Bitcoin Magazine, The Quantum Issue. We’re sharing it here as an early look at the ideas explored throughout the full issue.

This post The Quantum Issue: WTF Is Quantum Computing? first appeared on Bitcoin Magazine and is written by Shinobi.

Exploring Bitcoin’s oldest addresses, quantum computing, public-key cryptography, and the unanswered questions surrounding Satoshi Nakamoto’s untouched fortune.

More than 1.1 million Bitcoin have remained untouched since 2009.

They belong — at least according to overwhelming on-chain evidence — to Bitcoin’s anonymous creator, Satoshi Nakamoto.

For over fifteen years, these coins have never moved.

Yet as quantum computing advances, an uncomfortable question is becoming increasingly difficult to ignore:

Could the largest dormant Bitcoin fortune in history eventually become vulnerable?

The answer is far more complicated than most headlines suggest.

1. Anatomy of a Myth: Why Satoshi’s Coins Are Called the “Weakest Link”

To understand this hypothesis, we must first look at the pessimistic scenario accepted by the majority of crypto experts.

• Address Type (P2PK): Satoshi’s early coins are not stored on familiar modern addresses (P2PKH or Bech32), but rather on the simplest P2PK (Pay-to-PubKey) format.
• The Problem: On these addresses, the user’s public key is exposed directly on the blockchain (it’s not a hashed key, but raw code).
• The Quantum Threat: Theoretically, a powerful future quantum computer utilizing Shor’s algorithm could mathematically derive the private key from an exposed public key in a reasonable amount of time.

This is why traditional consensus dictates that if a sufficiently powerful quantum machine ever emerges, Satoshi’s coins will be the first and most probable target for attack. They are massive, ancient, and feature exposed keys.

But what if we are underestimating the architect of the system?

2. The High-Entropy Hypothesis: Could Satoshi Have Used “Physical Chaos”?

This is where things get genuinely fascinating. In cryptography, entropy is the measure of true randomness.

• Low Entropy: When a key is generated using a standard pseudo-random number generator (PRNG) relying on system clocks, process times, or session IDs. Cracking such a key for a quantum computer is elementary.
• High Entropy: Randomness harvested from the physical world — hardware thermal noise, radioactive decay, atmospheric interference, or intentional erratic movements (a task fundamentally impossible for any quantum computer to crack, as such data sources possess a truly chaotic nature).

Imagine a simple example: what if we take an ordinary microphone and generate entropic data based on an acoustic source, say, the sound of raindrops hitting a wooden window frame during a storm? Think about it — how many such unique, unpredictable sources of entropy could be created? More than just one.

Why Might Satoshi Have Done This?

1. He was a perfectionist and a paranoid. The person (or group) who designed Bitcoin understood cryptography at an exceptionally high level. Relying on a standard, vulnerable random number generator to mint the most vital coins in the system would have been an unforgivable amateur mistake.
2. The Isolated Environment of 2009. In those early months, Satoshi worked alone. He had total freedom to experiment with manual key generation in an isolated environment, applying unorthodox physical sources of randomness.
3. The Clean Distribution. Early blockchain researchers note that the distribution of public keys in the genesis blocks looks remarkably uniform and “clean,” subtly hinting at superior code quality and high initial entropy.

3. How Bitcoin is Preparing for the Quantum Era

While the hypothesis of high entropy adds a layer of optimism, Bitcoin developers are not leaving things to chance. The cryptographic community is proactively engineering defensive mechanisms.

Long before truly dangerous quantum computers materialize, the Bitcoin community will almost certainly implement a soft fork to transition to post-quantum cryptographic algorithms (such as lattice-based signatures or other quantum-resistant schemes). This will allow users to safely “migrate” their funds from legacy addresses to modern ones without fearing mathematical decryption.

However, what happens to old, dormant addresses (including Satoshi’s coins), where no one is present to execute a manual migration? That remains an open protocol question that the community will have to resolve via consensus in the future.

Conclusion: Noise or Foundation?

Let’s step away from the opinions of famous social media voices and public figures for a moment, and ask ourselves one simple question:

Could a person who built such a high-tech blockchain, created the most high-performing project structure in history, and possessed some of the deepest knowledge in cryptography, have simply ignored or failed to account for the eventual emergence of supercomputers and AI applications? Of course not.

It is genuinely disheartening to see certain prominent figures making completely absurd public proposals like: “Let’s protect Satoshi’s Bitcoin assets by simply burning them, freezing them, or rewriting them via a fork.” They forget the core law of Bitcoin that must never be broken: no single coin can ever be changed, rewritten, or destroyed — neither through a fork nor through any other coercive mechanism. The right to private property here is absolute.

Those who propose such solutions are simply underestimating Satoshi. This person took care of their assets and the security of the system far better than critics can possibly imagine.

My hope is that these public figures finally begin genuinely researching the internal mechanisms of how Bitcoin works, understand what it was built for, and stop spreading panic, moving instead to discussing truly serious matters. The palace of the digital economy is built to last centuries.

https://www.youtube.com/@orlaresearcher

More detail: https://medium.com/@orlaresearcher/4d6c68fed6ee?source=friends_link&sk=f8292678c4a6a0185b58b9d72f62380e

Satoshi’s Lost Million: Are Bitcoin’s Oldest Coins Really Vulnerable to Quantum Computing? was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.

Bitcoin Magazine

Legendary Investor Ray Dalio Still Holds Bitcoin — But Only 1% of His Portfolio 

Legendary investor Ray Dalio still only holds 1% of his portfolio in Bitcoin — and prefers gold instead. 

Speaking on a Thursday episode of the Diary of a CEO podcast, the Bridgewater Associates founder explained that while there are different types of money, and Bitcoin was one of them, gold was a better investment.  

Dalio has gone from saying he wouldn’t invest in Bitcoin over the years to finally admitting it was in his portfolio. 

“[Bitcoin] is a type of money that can’t be printed, but there are technologies that can hurt it — in other words, if there’s quantum computing,” he said. 

“And it can be monitored by governments and so on, and it could be taxed. And digital currencies are somewhat similar.”

Dalio added that Bitcoin only makes up 1% of his portfolio. “I prefer that — I’m pointing to the gold bars here — rather than the Bitcoin,” he added on the show. 

Last year, Dalio also admitted that Bitcoin only made up 1% of his investments. 

This isn’t the first time Dalio has criticized Bitcoin and praised gold: Back in 2020, the billionaire investor said that the cryptocurrency was too volatile to use as money but said everyone should have some gold in their portfolio. 

Dalio continued that governments could crack down on Bitcoin. “When the governments say I don’t want it, they have the power, therefore, to do whatever they want with it, and central banks will not own any significant amount of that because of the reason I said: they want their transactions to be private and in their control.”

While Dalio still takes a cautious approach to Bitcoin buying, over the years, the asset has become more widely accepted among traditional investors and even Wall Street heavyweights — including BlackRock, the world’s largest asset manager.  

BlackRock CEO Larry Fink in recent years has called Bitcoin an “international asset” and a way of “digitizing gold.” 

This post Legendary Investor Ray Dalio Still Holds Bitcoin — But Only 1% of His Portfolio  first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.