Quick Breakdown:
- SEC submission warns quantum computing could break Bitcoin and Ethereum’s encryption by 2028.
- Proposal outlines phased migration to quantum-resistant cryptography using NIST standards.
- Risks include systemic market collapse, massive investor losses, and erosion of confidence.
A new proposal submitted to the U.S. Securities and Exchange Commission’s (SEC) Crypto Assets Task Force has raised alarm over the potential impact of quantum computing on the foundations of digital assets, warning that Bitcoin, Ethereum, and the broader crypto ecosystem face systemic risks unless urgent safeguards are adopted.
The submission, authored by Daniel Bruno Corvelo Costa and titled the Post-Quantum Financial Infrastructure Framework (PQFIF), outlines a roadmap to transition digital assets to quantum-resistant cryptographic standards. It warns that without decisive action, trillions of dollars in crypto assets could be left exposed once cryptographically relevant quantum computers (CRQCs) achieve breakthrough capability.
‘Harvest Now, Decrypt Later’ Threat Emerges
The proposal highlights the growing concern of adversaries engaging in ‘Harvest Now, Decrypt Later’ tactics, stockpiling encrypted blockchain data today with the expectation of decrypting it once quantum systems mature. This strategy, long discussed in cybersecurity, is seen as a direct risk to institutional exchanges, custodians, and payment processors that rely on existing cryptography.
The framework urges immediate measures, including automated vulnerability testing of platforms, prioritizing protections for high-risk systems like institutional wallets, and implementing a phased transition that combines both classical and post-quantum cryptographic protocols.
It also aligns with standards finalized by the U.S. National Institute of Standards and Technology (NIST) in 2024, specifically FIPS 203–205 and HQC, ensuring consistency with federal cybersecurity initiatives.
Countdown to ‘Q-Day’
One of the most pressing concerns outlined in the filing is the possibility of an abrupt “Q-Day” scenario, where a sudden quantum breakthrough renders current blockchain security obsolete. Such an event, experts warn, could arrive as early as 2028, triggering catastrophic investor losses, liquidity shocks, and a collapse of trust across global crypto markets.
In a separate development, Canary Capital has submitted a filing to launch the first-ever exchange-traded fund (ETF) tied to Trump Coin (TRUMP), a politically charged memecoin linked directly to President Donald Trump. If approved, the ETF would mark the first U.S. exchange-listed product centred on a partisan digital asset, intertwining crypto innovation with America’s polarized political landscape.
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