TLDR:

• Citi warns quantum computing could break Bitcoin encryption, with Q-Day set between 2030 and 2032.
• An estimated 6.7 to 7 million BTC in exposed wallets make Bitcoin a prime quantum attack target.
• Ethereum’s flexible governance positions it to adapt more readily against the quantum computing threat.
• Fireblocks CEO calls Bitcoin’s quantum risk a coordination issue and notes post-quantum tools exist.

Quantum computing poses a growing threat to the crypto sector, according to a new Citi research note. The report warns that Bitcoin faces far greater exposure than Ethereum.

That divide, analysts argue, comes down to governance rather than technology alone. Recent breakthroughs have pushed the estimated timeline for practical quantum attacks to as early as 2030.

With millions of Bitcoin already at risk, the industry is watching this closely. Analysts say the window for preparation is narrowing fast.

Bitcoin’s Structural Vulnerability to Quantum Attacks

Bitcoin transactions expose the sender’s public key to the network until they are confirmed. This creates a window where a quantum attacker could theoretically derive a private key.

From there, the attacker could redirect funds before the transaction is finalized. The exposure is brief but real, and it grows more dangerous as quantum computing hardware improves.

Google’s research suggests a 500,000-qubit machine could break Bitcoin’s encryption in minutes. No such machine currently exists, but the pace of progress is accelerating.

Google places its Q-Day estimate at 2032, while some researchers suggest 2030. Either way, the crypto industry has limited time to act.

The dormant wallet problem makes Bitcoin’s exposure more pressing. An estimated 6.7 to 7 million BTC sit in wallets with public keys already exposed. These wallets represent a concentrated and attractive target for any future quantum-capable actor.

Among those wallets, roughly 1 million Bitcoin believed to be mined by Satoshi Nakamoto remain untouched. These coins use early address formats that are particularly vulnerable to quantum attacks. At current prices, they carry an estimated value of around $82 billion.

Governance Gap Separates Bitcoin and Ethereum

Ethereum and other proof-of-stake networks are better positioned to adapt, Citi analysts said. Their more flexible governance allows for faster protocol changes when needed.

Ethereum also has a demonstrated history of regular protocol upgrades. That agility gives it a structural advantage against the quantum computing threat.

Bitcoin’s conservative, consensus-driven model is widely seen as central to its credibility. That same model, however, makes rapid protocol changes slow and contested.

Moving to quantum-resistant cryptography would likely require a hard fork, a notoriously difficult process. Broad network consensus would need to be achieved before any changes take effect.

Fireblocks CEO Michael Shaulov addressed this at the Financial Times Digital Asset Summit, arguing that the threat “is not actually a threat as people make it out to be.”

He described Bitcoin’s quantum challenge as “mostly a coordination issue” for the community rather than a technical one.

Shaulov further noted that “the entire internet industry needs to basically leapfrog and start using post-quantum encryption,” adding that “generally speaking, we have the available algorithm.” His remarks suggest that preparation, not the threat itself, remains the real challenge.

Citi’s analysts pointed to BIP-360 and BIP-361 as proposed Bitcoin upgrades worth monitoring. Ethereum, meanwhile, is not entirely immune to quantum threats either.

A quantum-enabled attacker could theoretically acquire enough private keys to control 33% of staked assets. This could allow disruption of block finality or broader network operations.

Bitwise will devote 10% of its HYPE ETF management fee to buying HYPE on its balance sheet.

Bitwise Asset Management announced that it will devote 10% of the management fee from its Bitwise Hyperliquid ETF (NYSE: BHYP) to holding HYPE on its balance sheet. The firm said the move mirrors Hyperliquid’s own tokenomics, which routes roughly 99% of protocol revenue through its Assistance Fund to repurchase HYPE.

“Hyperliquid’s token is explicitly designed so that rising trading activity on the Hyperliquid platform directly benefits token holders,” said Matt Hougan, Chief Investment Officer of Bitwise. “This has translated into historically strong returns. We think it’s one of the most exciting assets in crypto.”

HYPE ETF structure and the buyback signal

BHYP launched on NYSE on May 15 with a 0.34% sponsor fee, waived for the first month on the fund’s first $500 million in assets. It is the only US-listed Hyperliquid product to stake HYPE through the issuer’s own infrastructure rather than a third party. As crypto.news reported, HYPE rebounded toward $46 following the launch and has recovered roughly 65% since the start of 2026.

The 10% fee commitment adds a second capital channel into HYPE beyond staking. Bitwise stakes the fund’s holdings through Bitwise Onchain Solutions, with rewards flowing back into the fund after a 15% fee. Adding balance sheet purchases from management fees means institutional capital flows into HYPE through two parallel mechanisms.

Competing with BHYP is 21Shares’ THYP product, which launched on Nasdaq earlier in the week and drew approximately $1.2 million in inflows on its first day. Together, the two HYPE ETFs have accumulated more than $5.6 million in total net inflows.

Why the fee model matters for HYPE

Hyperliquid saw $2.9 trillion in trading volume in 2025, up more than 400% year on year, and currently commands roughly 60% of all on-chain derivatives open interest globally. HYPE’s market cap stands above $11 billion, making it the tenth-largest crypto asset by market capitalisation.

As crypto.news documented in its April filing update, Bloomberg ETF analyst Eric Balchunas flagged the addition of the BHYP ticker and fee details as signs the fund was approaching launch.

The fee-to-buyback pledge aligns Bitwise’s incentives directly with Hyperliquid’s community-first model. Every dollar of management fee generates a fraction of HYPE that sits permanently on Bitwise’s balance sheet, creating a demand mechanism that scales with fund AUM alongside ETF inflow growth.

Bitcoin (BTC) lost its hold on the $80,000 level over the weekend, and data suggest that the cryptocurrency needs to trade above the $74,000-$75,000 range, as it has repeatedly served as key support over the last two years. 

Crypto analyst Ardi said the next retest of the $74,000-$75,000 range could become the most important support test of the current bear market.

The analyst pointed to the role that the price range played during the last two years. In 2024, Bitcoin struggled to break above the range during a seven-month-long consolidation. In Q1 2025, the same area held as support before BTC rallied toward its cycle highs at $126,000.

BTC/USD, one-day chart analysis by Ardi. Source: X

Bitcoin is now approaching this level after its 5.78% weekly correction to $77,900. Ardi said the zone carries added weight because several major price pivots formed at $74,000-$75,000 across multiple time frames.

Crypto trader Alex Wacy focused on the $70,000 level. Wacy said holding that area could support a move back toward $85,000-$90,000. Losing it could open the door to a larger decline toward the $50,000-$60,000 range.

Related: BTC price ‘bull trap’ at $76.5K? Five things to know in Bitcoin this week

Bitcoin market signal weakens again

Bitcoin researcher Axel Adler Jr. said the Bitcoin bull-bear structure index turned bearish again after BTC failed to stay above $82,000 earlier this month.

It tracks six indicators linked to exchange-traded fund (ETF) demand, trader activity, exchange flows, and short-term price momentum. A positive reading indicates buyers are in control, while a negative reading points to growing seller pressure.

Bitcoin bull-bear structure index. Source: CryptoQuant

The bullish signal lasted less than three trading days. On May 6, the index briefly turned positive as Bitcoin climbed near $82,000. By May 17, the reading had dropped to -23.49, indicating that sellers quickly regained control.

Meanwhile, CryptoQuant data showed more Bitcoin moving onto exchanges from investors who bought BTC six to 12 months ago. The average buying price was around $110,851, meaning many are now sitting on large unrealized losses after the latest drop.

The share of older coins moving to exchanges also surged to 10.54%, far above its usual level below 1%, with market analyst Easy On Chain stating, 

“Historically, this reflects investors locking in major losses and exiting the market, creating severe spot-market selling pressure.”

Related: Saylor’s Strategy scoops $2B Bitcoin, holdings reach 843,738 BTC

Citi warned Monday that Bitcoin faces an outsized quantum computing threat, with up to 6.9 million BTC already vulnerable.

Citi analyst Alex Saunders warned in a May 18 digital asset research note that accelerating quantum computing advances are shortening the timeline for risks to Bitcoin and broader internet infrastructure.

The bank said Bitcoin is particularly exposed because its conservative governance structure makes protocol upgrades slow and difficult to coordinate.

The Citi Institute has been tracking quantum risk to financial systems throughout 2026, estimating that a quantum-enabled attack on a major US bank could put $2 to $3.3 trillion of GDP at risk, as reported by The Quantum Insider in February.

“While large-scale quantum attacks remain a medium-term concern, the pace of progress has shortened the horizon and warrants closer attention from investors,” Saunders wrote in the note.

Bitcoin’s governance is its quantum weakness

Citi identified vulnerabilities tied to public keys already exposed on-chain. Older Bitcoin addresses using pay-to-public-key outputs left public keys permanently visible, including wallets believed to belong to Bitcoin’s pseudonymous creator Satoshi Nakamoto. The bank estimates 6.5 to 6.9 million BTC hold already-exposed keys, worth roughly $450 billion at current prices.

The report flagged a “harvest now, decrypt later” risk, where attackers collect encrypted data today for future quantum-enabled decryption. Proof-of-stake networks such as Ethereum may be better positioned to respond because they upgrade protocols more frequently, Citi said.

However, the bank warned they present a larger attack surface. The crypto.news Bitcoin price page shows Bitcoin currently trading at around $76,900.

How far away is the actual threat?

The bank said it remains constructive on crypto’s long-term ability to adapt through post-quantum cryptography. Proposed Bitcoin upgrades including BIP-360 and BIP-361 are in development but require broad consensus among miners and node operators, a process that historically takes years.

Broader Bitcoin ecosystem context matters here: as crypto.news reported in its Q1 2026 mining sector coverage, the Bitcoin network is navigating simultaneously rising energy costs, the AI pivot among miners, and now growing institutional scrutiny of its long-term cryptographic resilience.

JPMorgan has separately noted that miners pivoting to AI face high capital needs and potential shareholder dilution, underlining that the broader Bitcoin infrastructure is undergoing structural stress from multiple directions at once.

HIVE Digital is pivoting from Bitcoin mining to a CAD 3.5b, 320 MW Toronto AI “super factory” hosting 100,000+ GPUs, sending its stock up over 35% on the news.

HIVE Digital Technologies, long known as a Bitcoin (BTC) mining company, has unveiled plans for a 320 MW AI infrastructure park in the Greater Toronto Area, a move that sent its shares up more than 35% at the open after the news broke on Monday, according to The Block. The company described the project as an AI “super factory” and said it aims to create one of Canada’s largest sovereign AI campuses at a time when demand for data center power and GPUs is exploding.

HIVE said the buildout will be led by its high‑performance computing subsidiary BUZZ, with total capital expenditure expected to reach roughly CAD 3.5 billion, or about $2.55 billion at current exchange rates. Once fully completed, the site is expected to support more than 100,000 GPUs across multiple large‑scale data halls dedicated to training and running AI models, putting the project in the same power class as some US hyperscale campuses.

The company is targeting the second half of 2027 for initial operations at the Toronto‑area AI park, suggesting a multi‑year construction and power‑procurement timeline that aligns with typical hyperscale data center projects. Management framed the site as “sovereign” AI infrastructure, signaling that HIVE wants to position the campus as a Canadian‑controlled alternative to US cloud and chip majors for governments, enterprises, and local AI startups.

HIVE did not disclose detailed financing plans in the initial announcement but indicated the CAD 3.5 billion budget includes land, power infrastructure, cooling, data center construction, and GPU hardware. Given the scale, the company is likely to lean on a mix of equity, debt, and potential partnerships with hardware vendors or cloud customers to lock in anchor tenants ahead of the 2027 launch.

From Bitcoin miner to AI infra player

The Toronto project marks the most aggressive step yet in HIVE’s ongoing shift away from pure Bitcoin mining toward AI and high‑performance computing infrastructure. In recent years, the firm has expanded GPU clusters and AI‑oriented data center operations in Paraguay and Sweden, effectively using its expertise in energy‑intensive mining to bootstrap a different kind of compute business.

That strategic pivot has taken place against a backdrop of rising competition and margin compression in Bitcoin mining, while GPU‑rich AI infrastructure has become one of the hottest capital‑markets stories of the cycle. By tying its future to a 320 MW “super factory” capable of hosting over 100,000 GPUs on Canadian soil, HIVE is betting that investors will reward it more as an AI data center operator than as a cyclical crypto miner — a bet Monday’s 35%+ share price pop suggests the market is, at least initially, willing to entertain.

SpaceX Bitcoin holdings stand at $637m, on-chain data shows, making it the fourth largest known corporate holder.

SpaceX holds 8,285 BTC worth approximately $637 million in Coinbase Prime custody, according to on-chain data from Arkham Intelligence as analyzed by Finbold on May 18.

The position has been unchanged since June 2022, when the company trimmed its holdings from a peak of roughly 28,000 coins over a three-week period, a reduction of approximately 70% from its peak.

The $637 million valuation places SpaceX as the fourth-largest known private corporate Bitcoin holder, trailing Block.one, Tether Holdings Limited, and Stone Ridge Holdings Group. Arkham data shows the company sitting on an unrealized profit of more than $360 million on the position at current prices.

SpaceX Bitcoin position to go public with IPO

SpaceX is targeting a June 12 Nasdaq debut under the ticker SPCX, with its public S-1 expected as early as May 20 and the roadshow kicking off the week of June 8. The company filed its confidential draft registration with the SEC on April 1, targeting a raise of approximately $75 billion at a $1.75 trillion valuation.

Once listed, the Bitcoin position will appear in quarterly filings under the FASB fair-value accounting rules that took effect in late 2025, making it visible to all investors for the first time. The crypto.news Bitcoin price page tracks the asset anchoring that treasury position in real time.

Whether SpaceX characterises Bitcoin as a strategic reserve or a tradeable position in its S-1 language will signal how seriously the company views crypto as part of its long-term financial strategy. For a company preparing the largest IPO in history, the framing of a $637 million crypto holding carries material investor interest.

SpaceX held Bitcoin through a $5b loss

SpaceX generated $18.5 billion in revenue in 2025 but reported a loss of nearly $5 billion after absorbing costs from its February 2026 acquisition of Elon Musk’s AI venture xAI. The company made no moves to liquidate its Bitcoin position despite the balance-sheet pressure.

As crypto.news reported on American Bitcoin’s Q1 2026 results, publicly traded mining companies are similarly holding or expanding Bitcoin treasury positions even as they pivot infrastructure toward AI.

Corporate Bitcoin accumulation has accelerated broadly in 2026. When SpaceX lists publicly, it will bring a potential $1.75 trillion valuation into the corporate Bitcoin holder cohort, adding institutional weight to the asset class that crypto.news has tracked across its ongoing coverage of institutional Bitcoin positioning.