Quantum Threat? BlackRock Flags Future Risk In Bitcoin ETF Filing

BlackRock has added a warning about quantum computing to its iShares Bitcoin Trust (IBIT) filing. Based on reports, the asset manager sees a future risk that ultra-powerful machines might crack the math securing Bitcoin. This is the first time BlackRock has flagged this concern in its spot Bitcoin ETF paperwork.

BlackRock Flags Quantum Risk

According to the updated regulatory filing on May 9, BlackRock now lists “quantum computing” among possible threats to its Bitcoin ETF. The trust holds about $64 billion in net assets, making it the largest spot Bitcoin fund on record.

Company lawyers say that if quantum processors become strong enough, they could decrypt private keys and put wallet security in jeopardy. It’s a standard move in ETF filings to note every conceivable risk, even if it feels far-off.

Quantum Chips Raise Alarms

Based on reports, worries kicked up last December when Google unveiled Willow, a chip claimed to solve certain tasks in minutes that would take today’s supercomputers 10 septillion years. A few months later, Microsoft introduced Majorana 1 to tackle long-standing scaling hurdles. Those announcements set off alarm bells in the crypto world.

In theory, a quantum device running Shor’s algorithm could factor the large numbers behind Bitcoin’s elliptic-curve signatures. In practice, we’re still in the early, error-prone “NISQ” era, so real attacks remain at least years away.

Tether’s CEO, Paolo Ardoino, surfaced another angle in February. He suggested that once quantum hackers can break old private keys, they might recover Bitcoin from the roughly 3.7 million coins considered lost forever.

Ardoino stressed that quantum machines are still distant from cracking 256-bit security, so no coins will reappear anytime soon. Crypto analyst Willy Woo jumped in, asking whether Google, a government agency, or a new startup would be first to seize those dormant assets. He figures the $350 billion in lost coins could spur fresh quantum investment if those keys ever become vulnerable.

Meanwhile, Bitcoin ETFs have pulled in more cash than ever. Data from Farside Investors shows over $41 billion in net inflows since these funds launched in January. On May 8, weekly ETF inflows topped the previous all-time high of $40 billion.

Bloomberg Intelligence analyst Eric Balchunas called lifetime net flows “the hardest metric to grow,” yet ETFs raced to new highs despite recent market jitters. Investors appear focused on price moves today, not on the quantum questions of tomorrow.

In the months ahead, crypto developers and standards groups will work on “post-quantum” signature schemes. If they stay on schedule, Bitcoin networks could adopt new, quantum-resistant algorithms long before any real threat appears. For now, the market’s heavy inflows suggest that mainstream buyers aren’t yet spooked by next-generation computing power.

Featured image from Getty Images, chart from TradingView