Quantum computing's threat to crypto has moved from theoretical whiteboards to real hardware. Independent researcher Giancarlo Lelli used public cloud-based quantum hardware to crack Bitcoin's elliptic curve encryption at a scale 512 times larger than any previous public record, which had only managed 6 bits.
Project Eleven's Experiment: Cloud Quantum Hardware Breaks 512x Encryption
As part of the Q-Day Prize competition offering 1 BTC reward, Lelli executed the attack leveraging cloud quantum resources. Project Eleven CEO Alex Pruden called it the largest publicly recorded quantum elliptic curve hack, noting that resource costs are falling fast. Cloud access now enables independent researchers to conduct experiments once confined to whiteboard theory. Quantum attacks have moved off the whiteboard and onto real hardware, Pruden said, though Bitcoin's core encryption was not directly broken.
Core Risk: Digital Signatures and 6.9M Exposed Public Key Addresses
In Bitcoin and most blockchains, cryptographic risk centers on signature systems, not mining. Deriving a private key from a public key is virtually impossible for classical computers but theoretically achievable for a sufficiently powerful quantum computer running Shor's algorithm. Unused Bitcoin addresses (with unrevealed public keys) are safer, while old or reused addresses grow more vulnerable. According to the Coinbase Quantum Advisory Council, roughly 6.9 million BTC sit in addresses with exposed public keys. At a Bitcoin price of ~$77,500, that represents over $530 billion in value. The council warned risk is not evenly distributed across the network, though no immediate threat exists.
Industry Response: Google Warnings and NIST Standards
Project Eleven's announcement followed Google Quantum AI's March paper, which estimated that a device with 500,000 physical qubits could theoretically break 256-bit elliptic curve encryption — far beyond current tech but enough to spark serious debate. Meanwhile, the U.S. National Institute of Standards and Technology (NIST) released its first post-quantum encryption standards in 2024, with developers and large institutions already planning a multi-year transition.
Governance Hurdles: Protocol Upgrades and Dormant Coins
New signature algorithms and address formats are under review to quantum-proof Bitcoin and similar networks, but reaching broad consensus is the biggest challenge. Bitcoin's conservative upgrade approach prevents risky changes but can delay critical security fixes. The real difficulty lies in dormant and lost coins: whether all participants must migrate addresses or keys, and if additional protocol measures will be introduced. Even blockchains like Ethereum, with faster governance, face similar technical risks.