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Two Different Approaches to Quantum Threats

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Two Different Approaches to Quantum Threats

The quantum divide between Bitcoin and Ethereum

Quantum computing has long been viewed as a distant, largely theoretical threat to blockchain systems. However, that perspective is now starting to change.

With major technology companies such as Google establishing timelines for post-quantum cryptography, and crypto researchers re-examining long-held assumptions, the discussion is shifting from abstract theory to concrete planning.

However, Bitcoin and Ethereum, two major blockchain networks, are addressing the quantum computing threat in different ways. Both networks depend on cryptographic systems that could, in principle, be compromised by sufficiently powerful quantum computers. However, their approaches to addressing this shared vulnerability are evolving in markedly different directions.

This divergence, often referred to as the “quantum gap,” has less to do with mathematics and more to do with how each network handles change, coordination and long-term security.

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Did you know? Quantum computers do not need to break every wallet at once. They only need access to exposed public keys, which means older Bitcoin addresses that have already transacted could theoretically be more vulnerable than unused ones.

Why quantum computing matters for blockchains

Blockchains rely heavily on public-key cryptography, particularly elliptic curve cryptography (ECC). This framework allows users to derive a public address from a private key, enabling secure transactions while keeping sensitive information protected.

If quantum computers achieve sufficient scale and capability, they could fundamentally weaken this foundation. Algorithms such as Shor’s algorithm could, in theory, allow quantum systems to compute private keys directly from public keys, thereby jeopardizing wallet ownership and overall transaction security.

The consensus among most researchers is that cryptographically relevant quantum computers are still years or even decades away. Nevertheless, blockchain platforms present a distinct challenge. They cannot be updated instantaneously. Any substantial migration requires extensive coordination, rigorous testing and broad adoption over multiple years.

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This situation highlights a key paradox: Although the threat is not pressing in the near term, preparation needs to begin well in advance.

External pressure is accelerating the debate

The discussion has moved well beyond crypto-native communities. In March 2026, Google announced a target timeline to transition its systems to post-quantum cryptography by 2029. It cautioned that quantum computers pose a significant threat to existing encryption and digital signatures.

This development is particularly relevant for blockchain systems because digital signatures play a fundamental role in verifying ownership. While encryption is vulnerable to “store-now, decrypt-later” attacks, digital signatures face a distinct risk. If compromised, they could increase the risk of unauthorized asset transfers.

As major institutions begin preparing for quantum resilience, blockchain networks face growing pressure to outline their own mitigation strategies. This is where the differences between Bitcoin and Ethereum become more apparent.

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Did you know? The term “post-quantum cryptography” does not refer to quantum technology itself. It refers to classical algorithms designed to resist quantum attacks, allowing existing computers to defend against future quantum capabilities without requiring quantum hardware.

Bitcoin’s approach: Conservative and incremental

Bitcoin’s approach to quantum risk is guided by its core philosophy: minimize changes, maintain stability and avoid introducing unnecessary complexity at the base layer.

One of the most widely discussed proposals in this context is Bitcoin Improvement Proposal 360 (BIP-360), which introduces the concept of Pay-to-Merkle-Root (P2MR). Instead of fundamentally altering Bitcoin’s cryptographic foundations, the proposal seeks to limit exposure by changing the structure of certain transaction outputs.

The objective is not to achieve full quantum resistance for Bitcoin in a single move. Rather, it aims to create a pathway for adopting more secure transaction types while preserving backward compatibility with the existing system.

This approach mirrors the broader mindset within the Bitcoin community. Discussions often reflect extended time horizons, ranging from five years to several decades. The community is focused on ensuring that any changes do not undermine Bitcoin’s core principles: decentralization and predictability.

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Nevertheless, this strategy has attracted criticism. Some argue that delaying more comprehensive measures could leave the network vulnerable if quantum advances arrive faster than expected. Others contend that making hasty changes could introduce avoidable risks into a system designed for long-term resilience.

Ethereum’s approach: Roadmap-driven and adaptive

Ethereum, by contrast, is pursuing a more proactive and structured strategy. The Ethereum ecosystem has begun formalizing a post-quantum roadmap that treats the challenge as a multi-layered system upgrade rather than a single technical adjustment.

A key element in Ethereum’s approach is “cryptographic agility,” which refers to the ability to replace core cryptographic primitives without undermining the stability of the network. This aligns with Ethereum’s broader design philosophy, which emphasizes flexibility and continuous iterative improvement.

The roadmap covers multiple layers:

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  • Execution layer: Investigating account abstraction and alternative signature schemes that can support post-quantum cryptography.

  • Consensus layer: Assessing replacements for validator signature mechanisms, including hash-based options.

  • Data layer: Modifying data availability structures to ensure security in a post-quantum setting.

Ethereum developers have positioned post-quantum security as a long-term strategic priority, with timelines extending toward the end of the decade.

In contrast to Bitcoin’s incremental proposals, Ethereum’s approach resembles a staged migration plan. The goal is not immediate rollout but gradual preparation, allowing the network to transition when the threat becomes more concrete.

Why Bitcoin and Ethereum are taking different approaches to the quantum threat

The divergent approaches of Bitcoin and Ethereum are not a coincidence. They arise from fundamental differences in architecture, governance and philosophy.

Bitcoin’s base layer design emphasizes robustness and predictability, fostering a cautious attitude toward significant upgrades. Any change must meet a high bar for consensus and, even then, is usually limited in scope.

Ethereum, by contrast, has a track record of coordinated upgrades and protocol evolution. From the shift to proof-of-stake to ongoing scaling improvements, the network has demonstrated a willingness to execute complex changes when needed.

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This distinction shapes how each network views the quantum threat. Bitcoin generally sees it as a remote risk that warrants careful, minimal intervention. Ethereum treats it as a systems-level issue that requires early planning and architectural adaptability.

In this context, the “quantum gap” is less about disagreement over the nature of the threat and more about how each ecosystem defines responsible preparation.

Did you know? Some early Bitcoin transactions reused addresses multiple times, unintentionally increasing their exposure. Modern wallet practices discourage address reuse partly because of long-term risks such as quantum attacks, even though the threat is not immediate.

An unresolved challenge for both Bitcoin and Ethereum

Despite their differing strategies, neither Bitcoin nor Ethereum has fully resolved the quantum threat.

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Bitcoin continues to examine various proposals and weigh trade-offs, yet no clear migration path has been formally adopted. Ethereum, although more advanced in its planning, still faces substantial technical and coordination hurdles before its roadmap can be fully implemented.

Several open questions remain relevant to both ecosystems:

  • How to migrate existing assets protected by vulnerable cryptography

  • How to coordinate upgrades within decentralized communities

  • How to balance backward compatibility and forward security

These difficulties underscore the complexity of the issue. Post-quantum security represents more than a technical upgrade. It is also a test of long-term adaptability, governance and coordination.

Could security posture influence market narratives?

As institutional interest in quantum risk continues to grow, differences in preparedness could eventually shape how markets assess blockchain networks.

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The reasoning is simple: A network that demonstrates greater adaptability to threats may be viewed as more resilient over the long term.

However, this idea remains largely speculative. Because quantum threats are still seen as a long-term concern, any near-term market effects are more likely to stem from narrative than from concrete technical developments.

Nevertheless, the fact that the discussion is now entering institutional research and broader public discourse suggests that it could become a more prominent consideration in the future.

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MicroStrategy Makes Biggest Bitcoin Buy Since 2024, Will It Move BTC Price?

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MicroStrategy Makes Biggest Bitcoin Buy Since 2024, Will It Move BTC Price?

MicroStrategy has made its largest Bitcoin purchase in over a year, adding 34,164 BTC for $2.54 billion at an average price of $74,395.

The move lifts its total holdings to 815,061 BTC, extending its lead as the largest corporate Bitcoin holder.

Executive Chairman Michael Saylor signaled the buy a day earlier with his usual chart post on X. Markets read it as another accumulation signal—and they were right.

MicroStrategy is Buying Near Breakout Levels

The timing stands out. Bitcoin has been trading close to Strategy’s average cost basis of roughly $75,500, placing the firm near breakeven.

Strategy has a pattern of stepping in around key levels rather than waiting for deep pullbacks. This latest purchase is also a step up in size. The company bought roughly $1 billion worth of BTC the week prior and $330 million the week before that.

The acceleration suggests growing conviction at current price levels.

Recent analysis from Coinbase shows that large, consistent buyers like Strategy reduce the liquid supply of Bitcoin. Coins move off the market and into long-term holdings, tightening available float.

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That effect becomes more important when Bitcoin is already near a technical breakout level. At those points, even incremental buying can help push price higher, triggering momentum traders and systematic funds.

Strategy’s latest purchase absorbed more than 34,000 BTC in a single week. For context, miners produce roughly 450 BTC per day, meaning the company bought the equivalent of over two months of new supply in one move.

Bitcoin Supply Squeeze, With Limits

Still, the impact is not guaranteed.

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Coinbase notes that the price effect of large buyers can be muted if the market already expects the purchases, or if flows from ETFs, derivatives, or macro conditions outweigh them.

In other words, Strategy’s buying tightens supply in the background. It matters most when market conditions are already leaning bullish.

Strategy continues to fund its purchases through its capital programs, including its STRC preferred stock. The company still has significant capacity to raise funds, giving it room to keep accumulating.

With over 815,000 BTC now on its balance sheet, Strategy is steadily moving toward its long-term goal of 1 million BTC.

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The post MicroStrategy Makes Biggest Bitcoin Buy Since 2024, Will It Move BTC Price? appeared first on BeInCrypto.

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Kelp DAO hits back at LayerZero for trying to shift the blame after a massive exploit

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Kelp DAO hits back at LayerZero for trying to shift the blame after a massive exploit

The popular Spiderman meme showing three identical superheroes pointing fingers at each other is having its crypto moment today.

Kelp DAO is set to push back on LayerZero’s post-mortem of Sunday’s $290 million exploit, which essentially blames Kelp, a L2 source familiar with the matter told CoinDesk. Kelp plans to dispute the cross-chain messaging firm’s claim that it ignored repeated warnings to move away from a single-verifier setup. CoinDesk has reviewed and verified the memo Kelp plans to publish.

Kelp is a liquid restaking protocol that takes user-deposited ether, routes it through a yield-generating system called EigenLayer, and issues a receipt token, rsETH, in exchange.

LayerZero is the cross-chain messaging infrastructure that moves rsETH between blockchains, using entities called DVNs (decentralized verifier networks) to verify whether a cross-chain transfer is valid.

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On Saturday, attackers drained 116,500 rsETH, worth about $290 million, from Kelp’s LayerZero-powered bridge by poisoning the servers that LayerZero’s verifier relied on to check transactions.

Kelp, the source said, is planning on saying the DVN that was compromised via what it calls a “sophisticated state-sponsored attack” was LayerZero’s own infrastructure, not a third-party verifier.

Attackers compromised two of LayerZero’s own servers that check whether cross-chain transactions are legitimate, then flooded the backup servers with junk traffic to force LayerZero’s verifier onto the compromised ones.

All of that infrastructure was built and run by LayerZero, not Kelp, the source claimed.

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The source contested LayerZero’s framing of the “1/1 configuration” as a fringe choice made against guidance. LayerZero’s post-mortem said KelpDAO chose a 1-of-1 DVN setup despite expressing recommendations to configure multi-DVN redundancy.

A “1/1 configuration” means only a single validator must sign off on a cross-chain message for the bridge to act on it, leaving the system with no second check to catch a compromised or forged instruction. A multi-validator configuration (such as 2/3, 3/5, etc.) ensures there is no single point of failure that can approve a forged message on its own.

They added that, through a direct communications channel with LayerZero, which has been open since July 2024, they produced no specific recommendation for Kelp to change the rsETH DVN configuration.

LayerZero’s own quickstart guide and default GitHub configuration point to a 1/1 DVN setup, the source told CoinDesk, adding 40% of protocols on LayerZero are currently using the same configuration.

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The configuration Kelp ran also appears in LayerZero’s own V2 OApp Quickstart, where the sample layerzero.config.ts wires every pathway with one required DVN and no optional DVNs. That’s the same 1/1 structure.

Kelp’s core restaking contracts were not touched, and the exploit was isolated to the bridge layer, they added. Its emergency pause, 46 minutes after the drain, blocked two follow-up attempts that would have released an additional ~$200 million in rsETH.

CoinDesk reached out to LayerZero for comment on the story and didn’t hear back by the time of publication.

‘Deflecting responsibility’

Security researchers are also not buying LayerZero’s isolated framing, which pinned the blame on Kelp.

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Kelp is a liquid restaking protocol. Its core competency is staking infrastructure, EigenLayer integration, and liquid staking token management. When integrating with LayerZero, Kelp relied on LayerZero’s documentation, their defaults, and their team’s guidance to make configuration decisions, the source claimed.

Yearn Finance core team developer Artem K, who is popularly known as @banteg on X, posted a technical review of LayerZero’s public deployment code and said that the reference setup ships with single-source verification defaults across every major chain, including Ethereum, BSC, Polygon, Arbitrum and Optimism.

That deployment also leaves a public endpoint exposed that leaks the list of configured servers to anyone who queries it.

Banteg flagged in his analysis that he can’t prove which configuration Kelp used, but noted that LayerZero usually asks new operators to use its default setup, which its post-mortem criticized.

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Chainlink community manager Zach Rynes put it bluntly on X, alleging that LayerZero was “deflecting responsibility” for its own compromised infrastructure and accused the company of throwing Kelp under the bus for trusting a setup LayerZero itself supported.

As such, LayerZero has said it will no longer sign messages for any application running a single-verifier setup, forcing a protocol-wide migration.

Read more: ‘DeFi is dead’: crypto community scrambles after this year’s biggest hack exposes contagion risk

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Strategy boosts BTC stash to 800k with $2.5B for 34,164 BTC

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Crypto Breaking News

Strategy, Michael Saylor’s flagship vehicle and the largest public holder of Bitcoin, has surpassed 800,000 BTC in total holdings after its latest purchases. The company disclosed in an 8-K filing with the U.S. Securities and Exchange Commission that it bought 34,164 BTC for $2.54 billion between April 13 and 19, at an average price of $74,395 per coin.

The new purchase lifts Strategy’s total BTC under custody to 815,061 coins, purchased for $61.56 billion. The firm had about 780,897 BTC after a $1 billion buy just a week earlier. By coin count, the April tranche ranks as Strategy’s third-largest BTC acquisition, behind 55,500 BTC and 51,780 BTC purchases made in November 2024.

Key takeaways

  • New BTC haul: 34,164 BTC acquired for $2.54 billion (April 13–19), at an average price of $74,395 per coin.
  • Funding mix: Stretch (STRC), the perpetual preferred security, supplied about $2.18 billion (roughly 85.7% of the total proceeds); Class A common stock contributed about $366 million.
  • Record-pace activity via STRC ATM: The STRC at-the-market program delivered two consecutive days of heavy buying, with estimated BTC purchases rising to around 17,204 BTC across 11.9 million and 14.4 million shares sold, according to STRC Live—about a 518% surge versus the four-week average.
  • Cost basis and scale: The purchase price sits slightly below Strategy’s overall average cost basis, reinforcing the company’s long-standing commitment to accumulating BTC.
  • Future dividend signal: Strategy CEO Phong Le has signaled potential semi-monthly dividends for STRC, a unique feature among preferreds, a move the company says could be attractive.

Strategy expands its BTC stake with a mid-April buy

The363,164-BTC addition cements Strategy’s position as the world’s most prominent publicly traded Bitcoin holder. The deal, documented in an 8-K filing, shows the bulk of the purchase was executed through financing channels tied to STRC, the company’s perpetual preferred security. With the new BTC, Strategy’s total holdings stand at 815,061 BTC, a stake amassed for $61.56 billion to date.

For context, Strategy had been holding about 780,897 BTC after a $1 billion purchase a week prior, underscoring a rapid acceleration in accumulation over a short window. The new acquisition sits just below Strategy’s average cost of around $75,527 per BTC, illustrating a cautious approach to price levels over the course of the company’s investment program.

In a regulatory filing, Strategy confirmed the April purchases and reiterated that the company prioritizes a diversified approach to funding its Bitcoin stack, balancing debt-like instruments with equity capital. The size and cadence of the buys highlight how a very large corporate treasury can shape a single-asset narrative, particularly as BTC remains a focal point for corporate treasuries seeking to optimize risk/return over time.

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STRC fuels the deal, underscoring the instrument’s role in Strategy’s strategy

The funding structure behind the latest BTC accumulation shows STRC playing a central role. The SEC filing indicates STRC generated $2.18 billion in proceeds from the sale of shares, accounting for roughly 85.7% of the total funding for the new purchase. By contrast, net proceeds from the sale of Class A common stock accounted for about $366 million.

Strategy’s leadership has repeatedly highlighted STRC as a key financing vehicle. Last week, co-founder and executive leadership signaled the potential for STRC to pay semi-monthly dividends, a rarity among preferred securities. In remarks cited by the filing, Strategy CEO Phong Le said, “If we were to move forward with paying STRC semi-monthly, we would be in category one, the only preferred in the world that pays semi-monthly dividends. We think this is unique and attractive.”

ATM program momentum and what it signals

The week’s activity also reflected STRC’s at-the-market program’s capacity to drive large, rapid purchases. STRC Live reported a new daily record on April 13 of about 7,741 BTC tied to the sale of 11.9 million STRC shares, generating more than $1 billion in trading volume. The following day, the program set another record with an estimated 9,364 BTC tied to the sale of 14.4 million shares. Combined, the two days accounted for roughly 17,204 BTC, marking a 518% increase versus the four-week average.

These figures illustrate how a perpetual preferred instrument can work in tandem with a strategic corporate treasury plan to widen exposure to Bitcoin quickly, leveraging market liquidity to scale holdings without committing to large, single-block equity raises.

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Market implications and what investors should watch next

Strategy’s latest round of accumulation reinforces the company’s longstanding thesis: Bitcoin remains a core long-term asset, with corporate treasuries willing to deploy significant capital through diversified financing structures. For investors in Strategy and BTC, the coordination between STRC-based funding and large-scale purchases signals a sustained appetite for exposure to Bitcoin as a strategic reserve asset rather than a speculative position.

Key questions moving forward include how STRC dividends will evolve, whether subsequent purchases will follow the same financing pattern, and how regulators might view semi-monthly dividend structures tied to a crypto-asset strategy. Market participants will want to monitor further SEC disclosures and STRC Live updates for new guidance on payout schedules and any shifts in the ATM program’s cadence.

As Strategy continues to expand its BTC stash, eyes will remain on the company’s next steps and the potential ripple effects on corporate treasury behavior, Bitcoin price discovery, and the broader crypto market’s adoption by public-market players.

Readers should watch for additional updates from Strategy and STRC in the coming weeks, including any new 8-K filings or official statements on dividend structure and future ATM activity.

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Risk & affiliate notice: Crypto assets are volatile and capital is at risk. This article may contain affiliate links. Read full disclosure

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Saylor’s Strategy Boosts Bitcoin Holdings Past 815,000 BTC

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Saylor’s Strategy Boosts Bitcoin Holdings Past 815,000 BTC

Michael Saylor’s Strategy, the world’s largest public Bitcoin holder, has blasted past 800,000 BTC in total holdings after announcing its latest purchases.

Strategy acquired 34,164 Bitcoin (BTC) for $2.54 billion between April 13 and 19, according to an 8-K filing with the US Securities and Exchange Commission on Monday.

The buy ranks as Strategy’s third-largest Bitcoin acquisition on record by coin count, behind purchases of 55,500 BTC and 51,780 BTC in November 2024.

Holding around 780,897 BTC after a $1 billion purchase just a week ago, the company now holds 815,061 BTC, purchased for $61.56 billion.

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Source: SEC

The new acquisition was made at an average price of $74,395 per coin, slightly below the company’s average acquisition price of $75,527.

Saylor had teased the purchase on Sunday, signaling another large Bitcoin acquisition ahead of the announcement. The company also disclosed on Friday plans to pay Stretch (STRC) dividends twice monthly. STRC is the company’s perpetual preferred security.

“If we were to move forward with paying STRC semi-monthly, we would be in category one, the only preferred in the world that pays semi-monthly dividends. We think this is unique and attractive,” Strategy CEO Phong Le said.

Related: Bitmine ramps up Ether buys, pushes holdings toward 5% of total supply

Strategy’s STRC funds more than 85% of the purchase

Similar to a few recent acquisitions, the majority of Strategy’s latest purchase has been funded through STRC.

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According to the filing, STRC generated $2.18 billion, or about 85.7% of total proceeds, while sales of Class A common stock (MSTR) contributed $366 million.

Source: SEC

Last week marked several new records for STRC, including the company’s largest single-day buying spree through its at-the-market, or ATM, program.

On April 13, STRC set a new estimated daily record of about 7,741 BTC, based on the sale of 11.9 million shares through its at-the-market, or ATM, program, generating more than $1 billion in trading volume, according to STRC Live.

The stock set another record the following day, with an estimated 9,364 BTC tied to 14.4 million shares sold through its at-the-market, or ATM, program. The two days combined brought an estimated 17,204 BTC, marking a 518% surge versus the four-week average.

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