Audio · 2025-11-12 · 54m · 6 moments

BTC253: Quantum Computing and Bitcoin w/ Charles Edwards (Bitcoin Podcast)

Preston and Charles dive into the fundamentals of quantum computing, its transformative applications, and the looming threat it poses to Bitcoin encryption. They break down the distinction between physical and logical qubits, real-world use cases, and the exponential progress in the field. With timelines tightening, they call for urgent collaboration across the Bitcoin and cryptography communities to prepare for a post-quantum world. IN THIS EPISODE YOU’LL LEARN: 00:00:00 - Intro 00:02:30 - ✦ AI generated

Apple Podcasts ↗

GUEST Charles Edwards

timeline · colored by role

Mechanism

A quantum computer can solve the mathematical basis of all encryption (factoring primes and discrete logarithms) by simulating multiple values simultaneously via superposition and entanglement, making Shor's algorithm feasible on sufficiently large machines.

Charles and Preston explain the core mechanism: classical computers must try one solution at a time (like guessing a pin code digit by digit), while quantum computers use superposition to simulate multiple states simultaneously and entanglement with interference to converge on the correct answer almost instantly.

transcript

Charles Edwards: essentially, a quantum computer is trying to replicate the quantum state and physics, which is, you know, potentially being in multiple values at the same time. So that where that becomes interesting in programming and especially what we're talking about here in encryption is you can essentially model multiple values at the same time and zero in on an optimization really quickly. So if you're trying to guess a password, if it's just a pin code and a lock and it is scrolling through the numbers and if it's got three different number options, you can get there eventually, it'll take you a while. But with a quantum machine, you can basically simulate all of them at once more or less and solve things really quick.

explains mechanism · 1

Fact

Quantum computing has practical use cases today—drug discovery, financial optimization, and defense—and is on a hockey-stick trajectory similar to early AI, already delivering significant improvements in speed and optimization for early adopters like AstraZeneca and HSBC.

Charles counters the view that quantum computing is purely theoretical, citing real-world deployments: AstraZeneca using it for drug discovery with significant speed improvements, HSBC for bond optimization, and defense applications. He compares the current state to early ChatGPT—rough and limited but on an exponential trajectory.

transcript

Charles Edwards: A lot of people say, quantum's not here today. It's got no practical use. It is here and it does have use today. It's still very neat early in its development. It's like if you were to use ChatGPT 5, six years ago, even Altman, the creator of it, said it was a terrible product, right? So quantum is still like a really basic iteration of where it's at today. So it's just really kind of, it's already proven those use cases and it's on that trajectory in my mind in the early stages of the hockey stick of any kind of technical adoption.

Prediction◆

Quantum computing progress is advancing faster than Moore's Law, with qubit count doubling every 18 months and error rates dropping each year, making Q-day (ability to break Bitcoin encryption) a tangible risk within 2–8 years, with high probability in the 4–5 year window.

Charles argues that quantum computing is progressing exponentially—faster than Moore's Law—and that multiple authoritative sources converge on Q-day arriving within 2-8 years, with a high probability around 4-5 years, making it an urgent threat to Bitcoin's elliptic curve cryptography.

transcript

Charles Edwards: I think currently the rate of qubits is progressing faster than Moore's law. So if you plot, it's like the Bitcoin chart on a log scale, right? It's a straight line on a log scale where progression is really consistently improving every year that's hit there. And this is already a couple years old, but the trend is not slowing down and the number of qubits is doubling about every 18 months, so faster than Moore's law. And at the same time, each year we're seeing like an extra 9 or an extra granular level of lower error rates. So it's moving a lot faster than people think... These four sources kind of converge in around 2:00 to 9 years from now. The Jameson lot is a Bitcoin developer, is deep in the space... He says it's a 50% risk in 4 to 9 years... Pierre Lucky is a PhD in maths and physics, specializing in quantum. He thinks it's two to six years away. McKinsey, obviously one of the biggest think tanks in the world, are saying Q day, that's RSA broken, is 2 to 10 years away... And then one of the big papers on this matter is that 2017 quantum paper at the bottom. And they're saying you only need 2,330 qubits. That's the logical ones. To break Bitcoin's encryption. And most leading firms right now are projecting that capability within four to five years.

Claim◆

Bitcoin has two critical decisions to make: first, agree on a quantum-proof encryption upgrade and migrate the active network (70-80% of coins), and second, decide what to do about the ~20-30% of coins on old P2PK addresses (including Satoshi's coins) that will be taken by quantum computers regardless.

Charles explains that Bitcoin faces two major decisions: agreeing on a post-quantum encryption standard and migrating active wallets (which covers ~70-80% of coins), and separately deciding how to handle the ~20-30% of coins on exposed P2PK addresses—including Satoshi's coins—that are permanently vulnerable and will be seized by a sufficiently powerful quantum computer.

transcript

Charles Edwards: there's two major discussions and decisions that need to be had in my view on the Bitcoin front. First is obviously agreeing a technology to upgrade to quantum proof encryption and wallet systems. And then probably 70, 80% of the network will happily move across to that when that decision is made. And then the second decision is what do we do with the lost coins, the 20 to 30% of coins, which are on really old addresses, like Satoshi's coins, P2PK hash systems, and also any coins that, any coins have been lost or, just sitting in safes or just fail to upgrade in time, those will be taken with certainty by a quantum machine. There's nothing we can do about it. And so we need to decide as a community, do we just let that happen or do we initiate some kind of process to burn that in the code?

explains mechanism · 1extends · 2provides context · 1

Prediction

A post-quantum Bitcoin upgrade needs to be agreed upon in 2026 because consensus takes at least a year and the migration itself takes 6-12 months, putting us on the leading edge of the risk window starting in 2027.

Charles warns that Bitcoin's consensus process is slow and the physical migration of wallets (limited by block times and transaction throughput) takes 6-12 months even in best-case scenarios. To avoid being even one minute late, he argues the community must agree on a solution in 2026.

transcript

Charles Edwards: if we all agree today on the solution, we could... get it out in time. But the problem is that if we did agree today, the lead time to get everyone across to this new wallet infrastructure or the soft fork or hard fork, whatever it is, going to take 6 to 12 months... If everyone with, say, over $100 in their wallet was to say, I'm going to move across to a new wallet, which is this quantum-proof encrypted wallet, that's going to take 30 days, assuming no other traffic. If you want to do a test transaction, as we usually do, because you might have a significant sum of money on there and you don't want to lose it... then double as 60 days, right? Add in organic traffic, probably double it again. You're basically at six months in a best case scenario... so where I get concerned is that we know consensus takes time, probably best case a year, which is why I'm basically posting all the time. I want to see a solution agreed in 2026. If we get it solved in 2026 and agreed, then we might have a year to get to 2027 to roll it out. And that's at the kind of leading edge risk frontier, I suppose, for when a quantum machine could break Bitcoin, right?

explains mechanism · 2extends · 1

Claim

The biggest threat to Bitcoin is not necessarily the date Q-day arrives, but that if coins are suddenly unlocked by quantum computers and the community hasn't prepared, the entire trust system of Bitcoin collapses.

Charles argues that the catastrophic scenario is not quantum computers existing, but the Bitcoin community failing to prepare—if 20-30% of supply suddenly becomes spendable by anyone with a quantum machine and no upgrade is in place, the trust that underpins Bitcoin's $2 trillion value would evaporate instantly.

transcript

Charles Edwards: If we have the kind of blase approach that it might be four years, it might be 10 years or 15 years, if we're one minute too late on upgrading this and getting everyone across, the whole trust system of Bitcoin is built on its trusting the code and its security, right? Like it took us 16 years for Bitcoin to get to 2 trillion. And it's hard to gain trust and easily lost. So if we were to say 10, 20, 30, or whatever percent of supply unlocks all of a sudden over a 12 month period, whether that be in two years time or three years time or five years time, and we hadn't solved on this, I think the whole trust system network collapses.

provides context · 1

Highlight slides

Quantum Progress Exceeds Moore's Law✦ from: Quantum computing progress is advancing faster than Moore's Law, with qubit count doubling every 18 months and error rates dropping each year, making Q-day (ability to break Bitcoin encryption) a tangible risk within 2–8 years, with high probability in the 4–5 year window.Q-Day Consensus: 2–8 Years✦ from: Quantum computing progress is advancing faster than Moore's Law, with qubit count doubling every 18 months and error rates dropping each year, making Q-day (ability to break Bitcoin encryption) a tangible risk within 2–8 years, with high probability in the 4–5 year window.Bitcoin's Two Critical Post-Quantum Decisions✦ from: Bitcoin has two critical decisions to make: first, agree on a quantum-proof encryption upgrade and migrate the active network (70-80% of coins), and second, decide what to do about the ~20-30% of coins on old P2PK addresses (including Satoshi's coins) that will be taken by quantum computers regardless.The Exposed Coins — A Fork Decision✦ from: Bitcoin has two critical decisions to make: first, agree on a quantum-proof encryption upgrade and migrate the active network (70-80% of coins), and second, decide what to do about the ~20-30% of coins on old P2PK addresses (including Satoshi's coins) that will be taken by quantum computers regardless.

Related episodes

Video · Lex Fridman

The Rise and Fall of the Roman Empire and the Byzantine Empire | Lex Fridman Podcast #498

→

Video · The Cognitive Revolution

Fable's Back, AI Engineer Recap, & SambaNova

→

Video · The Cognitive Revolution

AI Superforecasters?!

→