As excitement around cryptocurrencies continues to grow, a leading Israeli blockchain expert is warning that a technological breakthrough could one day pose an existential threat to Bitcoin and other digital assets.
Eli Ben-Sasson, a mathematician and the co-founder and CEO of StarkWare, said the rapid progress toward practical quantum computing should be treated as a looming systemic risk for today’s cryptographic systems. He compared the current state of the crypto market to passengers celebrating aboard the Titanic while an iceberg looms ahead — visible, massive and potentially catastrophic.
At the heart of the concern is quantum computing’s theoretical ability to break widely used encryption methods. Bitcoin wallets and much of the global financial system rely on cryptographic schemes such as RSA and elliptic curve encryption, which experts believe could be cracked by sufficiently powerful quantum computers.
Quantum computing remains experimental, but progress is accelerating. Unlike classical computers, which process bits as either 0 or 1, quantum computers use qubits that can exist in multiple states simultaneously, allowing certain calculations to be performed exponentially faster. Researchers say even machines with a relatively small number of qubits could outperform today’s most powerful supercomputers for specific tasks.
Major technology companies and startups worldwide — including IBM, Google, Microsoft, Quantinuum, IonQ and several Israeli firms — are racing to develop large-scale, error-corrected quantum computers. Some companies have publicly stated goals of building machines with hundreds of thousands or even millions of qubits. While significant technical hurdles remain, including error correction and system stability, experts say a breakthrough could come sooner than once expected.
The potential implications extend far beyond cryptocurrency. A sufficiently advanced quantum computer could undermine encryption protecting banking systems, military communications and government secrets. Security experts warn that adversaries may already be stealing encrypted data to store for future decryption, a strategy known as “harvest now, decrypt later.”
Ben-Sasson said this prospect has prompted him to urge the crypto community to prepare in advance by adopting so-called post-quantum cryptography — encryption designed to withstand quantum attacks. StarkWare develops blockchain technologies based on hash functions, which many researchers consider more resistant to quantum computing threats.
Post-quantum encryption is already being adopted in parts of the tech and financial sectors. Companies such as Apple, Google, Signal and Zoom have integrated post-quantum methods into products and services, while institutions including HSBC and the Bank of France have announced similar transitions.
Bitcoin, however, presents a unique challenge. With no central authority, changes to its underlying protocol require broad consensus among developers, miners and node operators. Ben-Sasson said that meaningful protection against quantum threats would likely require a so-called hard fork — a fundamental and potentially contentious upgrade to the network.
Security experts say the decentralized nature that made Bitcoin resilient has also made it slow to adapt to emerging threats. Some warn that if the issue is not addressed in time, confidence in the system could collapse rapidly.
Beyond cryptocurrencies, Israeli and international researchers are also exploring how even encrypted data may leak information through traffic patterns, metadata and behavioral signals — raising further questions about privacy in a post-quantum world.
Despite the uncertainty, experts broadly agree on one point: quantum computing is no longer a distant theoretical concern. Governments, financial institutions and technology companies are already preparing for its arrival, and some warn that systems that fail to adapt could face serious consequences once the technology matures.