A new study shows that Bitcoin is facing a discount of about 20% due to the threat of Quantum Computing, and it can rise further without improvements.
Bitcoin Quantum discount could reach 60% by 2028
Capriole Investments founder Charles Edwards has published a new piece of research on how the risk of Quantum Computing could lower the fair value of Bitcoin. Quantum Computing is an upcoming technology that could, in theory, be used to hack old BTC wallets.
“Quantum hacking would compromise the core tenets of Bitcoin,” Edwards noted. The commentator went on to say:
“Trust the code” again “hard money” value propositions will be crippled overnight as up to 30% of all Bitcoin supply (coins with exposed public keys) are stolen and depleted.
Currently, it is not yet known when Quantum Computing will advance enough to be able to compromise BTC cryptography (an event known as “Q-Day”), but there has been an increasing amount of talk around the topic.
Edwards, who has been very vocal on this issue in the Bitcoin community, said that, given the threat of Quantum, reasonable market participants should now discount the fair value of the asset by the “Quantum Discount Factor.”
The research article defines this metric as the number of years of BTC development against the threat removed from the increasing probability of Q-Day occurring annually. To find out the chances of Q-Day happening, Edwards spoke with estimates from various experts.
Below is the aggregated data for these forecasts.
The probability of Q-Day occurring by year | Source: @caprioleio on Substack
As seen in the chart, there is a 60% chance that Q-Day will happen in 2030 and about an 80% chance that it will happen in 2031. All predictions place it happening sometime in the next nine years (2035 and earlier).
As for how long it would take to develop Bitcoin, this article puts a realistic estimate at about two years. “This is a very optimistic and aggressive situation strength “It’s possible in one year, but it’s more likely closer to 3 years, as the diagram below shows,” said Edwards.
Combining these two measurements together, the analyst has mapped the Quantum Discount Factor of the digital asset.
How the Quantum Discount Factor will rise with each year | Source: @caprioleio on Substack
From the graph, it is clear that the Quantum Discount Factor for 2026 sits at 20% for Bitcoin. This means that the fair value of the asset should be 20% lower today due to Quantum risk.
In the event that no action is taken to secure the network against the threat, the discount will increase to around 40% by 2027. The figure will rise to around 60% in 2028 and 75% in 2029.
BTC price
At the time of writing, Bitcoin is floating around $67,700, down 2% over the past seven days.
Looks like the price of the coin has been moving flat | Source: BTCUSDT on TradingView
Featured image from Dall-E, chart from TradingView.com
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