Quantum computing threats escalate! Jefferies executive swaps BTC for gold, returning investments to traditional assets

Jefferies executive Christopher Wood withdraws 10% BTC to reallocate to physical gold (5% tangible + 5% mining stocks) due to concerns over quantum computing threats. The largest compliant crypto exchange in the US estimates that 32.7% (6.51 million coins) of BTC are at risk; developers say it would take 20-40 years to crack, but institutions are re-evaluating the risks.

Jefferies executive’s shocking decision: From digital gold back to physical gold

Investment bank Jefferies’ global equity strategist Christopher Wood recently made a shocking move in the financial markets. According to Bloomberg, Wood revealed in the latest issue of his influential weekly report Greed & Fear that he has officially removed 10% of Bitcoin ($BTC) from his simulated portfolio and reallocated the entire amount into the gold industry.

Specifically, this 10% has been redistributed into 5% physical gold and 5% gold mining stocks. Wood stated that this decision is not due to a bearish short-term outlook on Bitcoin, but stems from deep concerns over the rapid advancement of quantum computing technology, which he believes could undermine Bitcoin’s role as a long-term store of value within a few years.

Looking back over the past few years, Wood was one of Wall Street’s most prominent institutional supporters of Bitcoin. He first included Bitcoin in his simulated portfolio in December 2020, amid fears of currency devaluation caused by large-scale quantitative easing by governments worldwide during the pandemic. In 2021, he increased his allocation to 10% and has long advocated that Bitcoin is a hedge asset that younger generations see as a substitute for gold.

Since his initial purchase, Bitcoin’s price has surged approximately 325%, outperforming gold’s roughly 145% increase over the same period. However, as the development of quantum computers appears to have shortened from a “decade away” to “within a few years,” this seasoned strategist has chosen to return to traditional safe-haven assets with thousands of years of proven resilience, emphasizing that in an increasingly turbulent technological and geopolitical environment, gold’s safe-haven properties are becoming more attractive.

Wood’s decision is not isolated but reflects growing institutional concern over the threat posed by quantum computing. For fund managers managing hundreds of billions of dollars in long-term capital, even if the quantum threat materializes in 10 years, this uncertainty is enough to influence current asset allocation decisions. When risks cannot be precisely quantified, conservative choices favor time-tested assets.

How quantum computing threatens Bitcoin’s cryptographic foundation

The threat of quantum computers to blockchain security is not unfounded; it fundamentally involves a leap in computational logic. Wood explains in his report that traditional computers use bits for computation, which are either 0 or 1; quantum computers use quantum bits (qubits), leveraging superposition and entanglement, allowing qubits to exist in multiple states simultaneously.

This characteristic enables quantum computers to exponentially increase their computational power as the number of qubits grows. For example, 2 qubits can represent 4 states simultaneously, 3 qubits can represent 8, and so on. This explosive computational capability is the root of the threat to Bitcoin’s cryptographic foundations.

Currently, Bitcoin’s network relies on cryptography to secure wallets, authorize transactions, and manage mining processes. Cracking these encryption protocols with supercomputers is nearly impossible today. However, quantum computing could theoretically reverse-engineer public keys (public key cryptography) to derive private keys. Once private keys are compromised, attackers could transfer funds without authorization.

Threefold threats of quantum computing to Bitcoin

Public key cracking: Using quantum algorithms to derive private keys from public keys, enabling theft

Signature forgery: Breaking elliptic curve cryptography (ECDSA) to forge transaction authorizations

Network attacks: Theoretically threatening the mining consensus mechanism (though more difficult)

Wood believes that any credible threat to Bitcoin’s cryptographic basis would destroy its logic as a digital asset and even challenge its status as “digital gold,” because it directly threatens Bitcoin’s role as a store of value. This threat is not about price volatility or regulation but a fundamental technological upheaval.

6.51 million Bitcoins face quantum attack risk

Although many developers believe the quantum threat is distant, internal quantitative research has begun to sound alarms. According to David Duong, head of global investment research at the largest compliant crypto exchange in the US, approximately 32.7% of circulating Bitcoin—about 6.51 million coins—are potentially vulnerable to quantum attacks. These risks mainly concern early wallets, address reuse, and assets with exposed public keys on the blockchain.

Some extreme estimates suggest that if powerful quantum computers emerge, the proportion at risk could reach 20% to 50%. Early tokens from the Satoshi era, including roughly 1.1 million Bitcoins held by Satoshi Nakamoto himself, are considered primary targets for long-range quantum attacks.

Nic Carter, partner at Castle Island Ventures, criticized that some Bitcoin developers are in “denial” about this threat, and their unwillingness to face the quantum risk has already begun to depress Bitcoin’s price. Wood points out that for long-term capital investors managing retirement funds, if an asset’s security is in doubt within 5 to 10 years, its case as a “long-term store” becomes less solid.

Developers claim there is enough time to upgrade

In response to Wood’s withdrawal, opinions within the crypto community remain divided. Notable developers like Adam Back, CEO of Blockstream, counter that it would take at least 20 to 40 years for quantum computers to crack current signature schemes, giving the network enough time to transition to post-quantum cryptography. Senior developer Jameson Lopp also stated that migrating from existing protocols to new formats could take 5 to 10 years, and Bitcoin is unlikely to collapse in the short term.

Currently, related security solutions are beginning to attract capital attention. For example, startup Project Eleven recently raised $20 million to develop quantum-resistant tools and migration testing schemes for blockchain. Despite ongoing technical efforts, investor confidence has shown cracks. Wood’s move reflects the cautious attitude of traditional Wall Street toward frontier technological risks, favoring assets that have withstood centuries of testing.

Just this month, as he completed his asset reallocation, gold prices surged past a historic high of $4,600 per ounce amid geopolitical tensions and expectations of Fed rate cuts. The battle between “digital gold” and “physical gold” is no longer solely about returns but about who can truly safeguard investors’ wealth in the future quantum computing era. This debate over blockchain’s long-term security has officially moved from academic discussion into a core issue in mainstream finance.