Bitcoin’s “quantum” death sentence is causing a Wall Street rift, but the fix is already hidden in the code
The consensus that Bitcoin has matured into “digital gold” faces a new fracture line on Wall Street, one which has little to do with day by day worth volatility and every thing to do with the distant way forward for computing.
Two outstanding strategists named Wood are presently providing diametrically opposed roadmaps to international allocators for the world’s largest crypto asset.
On Jan. 16, Christopher Wood of Jefferies eradicated his agency’s long-standing Bitcoin publicity, citing the existential menace posed by quantum computing.
On the different hand, Cathie Wood of ARK Invest is urging buyers to look previous technical anxieties and concentrate on the asset’s distinct lack of correlation with conventional markets.
This divergence highlights a vital evolution in how institutional capital is underwriting crypto belongings in 2026. The debate is not merely about whether or not Bitcoin is a speculative token or a retailer of worth.
It has shifted towards a extra advanced calculation relating to survivability, governance, and the particular kind of hedge buyers imagine they’re shopping for.
The quantum exit
Christopher Wood, the international head of fairness technique at Jefferies, constructed a fame for navigating market sentiment along with his “Greed & Fear” e-newsletter.
His newest transfer cuts in opposition to the grain of two years of institutional accumulation by eradicating a 10% Bitcoin allocation from his mannequin portfolio completely.
In the reallocation, Jefferies shifted the 10% Bitcoin sleeve into belongings with older narratives: 5% into bodily gold and 5% into gold-mining shares.
The rationale is rooted in tail danger fairly than fast market dynamics. Wood argued that advances in quantum computing may finally undermine the cryptography that secures the Bitcoin community.
While most buyers nonetheless file quantum threats underneath “science initiatives,” Jefferies is treating the risk as a disqualifying issue for pension-style, long-horizon capital.
This anxiousness is discovering validation amongst technical consultants who argue the timeline for a menace is compressing quicker than markets understand.
Charles Edwards, founding father of Capriole, argued that a quantum computer could break Bitcoin in simply 2 to 9 years with out an improve, with a high likelihood in the 4- to 5-year vary.
Edwards describes the market as having entered a “Quantum Event Horizon,” a vital threshold at which the frontier danger of a hack is roughly equal to the time required to succeed in improve consensus and execute a rollout.
In the Jefferies framing, the uncomfortable actuality is that a quantum pc will sometime be capable to crack Bitcoin as a result of its safety assumptions relaxation on cryptographic primitives which can be weak to these highly effective future machines.
The particular menace entails adversaries “harvesting” uncovered public keys now to retailer them and decrypt the non-public keys later when {hardware} matures.
Estimates recommend greater than 4 million BTC are held in weak addresses attributable to reuse or older codecs. This leaves a “harvest now, decrypt later” assault vector that might compromise a huge share of the whole provide.
Quantum computing is not a direct Bitcoin menace
Grayscale, one in all the largest digital-asset managers, has sought to floor the 2026 market dialog by labeling quantum vulnerability a “pink herring” for this yr.
Its evaluation means that, whereas the menace is actual, it is unlikely to drive costs in the close to time period.
Considering this, Grayscale argued that in the longer run, most blockchains and far of the broader economic system will want post-quantum upgrades anyway.
This view aligns with developments inside the crypto sector.
Andre Dragosch, Bitwise Europe’s Head of Research, has additionally countered the “fast doom” narrative by emphasizing the sheer computational gulf between present know-how and a viable assault.
While Dragosch validated considerations about older wallets, he argues that the community itself stays terribly sturdy.
He wrote:
“Bitcoin now runs at 1 zeta hash per second, equal to multiple million El Capitan-class supercomputers. That’s orders of magnitude past the attain of as we speak’s quantum machines – and even past these anticipated in the foreseeable future.”
The case for Bitcoin
Considering the above, ARK Invest is doubling down on the argument that Bitcoin belongs in modern portfolios exactly as a result of it behaves not like anything.
In a 2026 outlook note, ARK’s Cathie Wood leaned on correlations fairly than ideology.
Her argument is scientific: Bitcoin’s return stream has remained weakly linked to main asset lessons since 2020, due to this fact providing a approach to enhance portfolio effectivity.
ARK supported this view with a correlation matrix utilizing weekly returns from January 2020 by way of January 2026. The knowledge exhibits Bitcoin’s correlation with gold at 0.14 and with bonds at 0.06.
Perhaps most strikingly, the desk exhibits that the S&P 500’s correlation with bonds is larger than Bitcoin’s correlation with gold.
Wood makes use of this knowledge to argue that Bitcoin ought to be considered as a helpful diversifier for asset allocators in search of larger returns per unit of danger in the years forward.
This represents a refined but vital shift in messaging. ARK is reframing Bitcoin from “a newer model of gold” into “an uncorrelated return stream with uneven upside.”
Redefining the hedge
For buyers watching the cut up between two of the market’s high-profile strategists, the fast takeaway is not that Bitcoin is damaged. It is that the institutional narrative is maturing into one thing extra demanding.
Jefferies is successfully saying that a hedge which may require a contentious protocol-level migration is not the identical as bodily gold, even when both assets can rally in the same macro regime.
This is as a result of gold doesn’t require coordination, upgrades, or governance to stay a legitimate asset. On the different hand, Bitcoin is a hedge that in the end depends upon its skill to adapt.
Conversely, there is a counterargument that conventional finance faces better near-term peril from quantum computing than Bitcoin does.
Dragosch mentioned:
“Banks rely closely on long-lived RSA/ECC keys throughout authentication and interbank communications. Once quantum machines can break these, systemic assaults grow to be attainable – far sooner than any sensible menace to Bitcoin’s decentralized structure.”
With this in thoughts, ARK is successfully saying that the advantages of portfolio diversification can justify a BTC place, even when the asset is nonetheless evolving.
So, the query that hangs over these instances is whether or not Bitcoin can credibly coordinate a post-quantum transition with out splintering the social consensus that offers it financial worth.
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