Crypto Biz: Bitcoin’s quantum threat is becoming an economic problem

Bitcoin’s security outlook is being reshaped by growing concerns over quantum computing, according to Stacks founder Muneeb Ali, who told Cointelegraph’s Chain Reaction podcast that the threat is already dampening institutional appetite. Ali warned that Bitcoin has only a few years to develop a quantum‑resistant roadmap, with meaningful progress needed by 2028 and a full transition targeted for 2030. The warning comes as US spot Bitcoin ETFs hold more than $104 billion in net assets and as Ripple secured a national trust bank charter, while USDC overtook Tether in euro‑stablecoin trading under new EU rules.

Background

The quantum‑computing debate has entered mainstream crypto discourse, raising questions about the long‑term viability of Bitcoin’s cryptographic foundations. Bitcoin’s signature algorithm, ECDSA, could be vulnerable to sufficiently powerful quantum computers, prompting calls for a transition to quantum‑resistant schemes. Muneeb Ali, who leads the Stacks layer‑2 project, argues that the uncertainty surrounding this transition is already influencing investors who view Bitcoin as a hedge against fiat debasement. At the same time, the broader crypto ecosystem is seeing regulatory milestones: Ripple received final approval from the US Office of the Comptroller of the Currency to launch a national trust bank, a move that mirrors Circle’s earlier approval and signals deeper integration of crypto firms with the traditional banking system. In Europe, the Markets in Crypto‑Assets Regulation (MiCA) has reshaped stablecoin dynamics, with Circle’s USDC now commanding 56 % of euro‑denominated stablecoin trading, up from 10 % at the start of 2024, while Tether’s USDt faces trading restrictions for European Economic Area customers. These developments occur against a backdrop of US spot Bitcoin ETFs amassing over $104 billion in assets, underscoring the scale of institutional exposure to Bitcoin’s price and security risks. The convergence of quantum‑security concerns, regulatory advances, and shifting stablecoin market shares creates a complex environment where technical, economic, and policy factors intersect.

What happened

Muneeb Ali, founder of the Stacks project, told Cointelegraph’s Chain Reaction podcast that quantum‑computing fears are already limiting Bitcoin’s growth and that institutional investors are being discouraged despite US spot Bitcoin ETFs holding more than $104 billion in net assets, according to BitBo data (Source 1). Ali warned that Bitcoin has only a few years to prepare for a quantum‑resistant upgrade, citing a need for meaningful progress by 2028 and a full transition by 2030, based on guidance from the National Institute of Standards and Technology (Source 1). He emphasized that even if developers agree on a quantum‑resistant solution, implementation could take years and holders would need time to move funds to new addresses (Source 1). Ripple announced that it received final approval from the US Office of the Comptroller of the Currency to establish a national trust bank, clearing the last regulatory hurdle after conditional approval in December 2025 (Source 1). The Ripple National Trust Bank will be supervised federally, manage reserves for the RLUSD stablecoin, act as a collateral trustee, and provide digital‑asset custody, while RLUSD issuance remains with Standard Custody & Trust Company, regulated by the New York Department of Financial Services (Source 1). Ripple CEO Brad Garlinghouse welcomed the approval, stating “crypto and banks work better together” (Source 1). In Europe, Circle’s USDC surpassed Tether’s USDt in euro‑stablecoin trading, now accounting for 56 % of euro‑denominated stablecoin volume, up from 10 % in January 2024, according to a Kaiko report (Source 1). The shift was accelerated by exchanges restricting USDt trading for European Economic Area customers to comply with the EU’s MiCA rules (Source 1). USDC’s euro order books are now about 40 % deeper than USDt’s, indicating stronger liquidity (Source 1). Both sources 1 and 2 repeat these points, confirming the quantum‑security concerns, Ripple’s charter, and USDC’s market share gains. No contradictory information appears across the sources.

Market impact

US spot Bitcoin ETFs have accumulated more than $104 billion in net assets, reflecting substantial institutional capital tied to Bitcoin’s price (Source 1). In the euro stablecoin market, USDC now holds 56 % of trading volume, a rise from 10 % at the start of 2024, and its order books are roughly 40 % deeper than those of USDt, suggesting improved liquidity for traders (Source 1). Ripple’s new national trust bank will manage reserves for the RLUSD stablecoin, though no specific asset figures were disclosed. The quantum‑security debate is cited as a factor that could dampen further inflows into Bitcoin, potentially affecting the $104 billion already in ETFs if investor confidence wanes. The shift in stablecoin market share also indicates a reallocation of trading volume from USDt to USDC within the European Union, driven by compliance with MiCA regulations.

Why it matters

The quantum‑computing threat, if realized, could undermine Bitcoin’s core cryptographic security, jeopardising the confidence of institutional investors who currently allocate over $104 billion to spot Bitcoin ETFs. Ali’s warning that the network’s slow upgrade process leaves little margin for delay suggests that any failure to achieve quantum resistance by 2028 could trigger a loss of trust and a sharp re‑pricing of Bitcoin assets. Ripple’s national trust bank charter signals deeper integration of crypto firms into the regulated banking sector, potentially expanding the institutional infrastructure for stablecoins like RLUSD and enhancing custody solutions. Meanwhile, USDC’s surge to 56 % of euro‑stablecoin trading reflects the impact of EU MiCA rules on market dynamics, reshaping liquidity and possibly influencing pricing and arbitrage opportunities across the region. Together, these developments illustrate how technical vulnerabilities, regulatory approvals, and policy‑driven market shifts can converge to affect capital flows, investor sentiment, and the broader stability of the cryptocurrency ecosystem.