US Backs Quantum Computing, Puts Crypto Encryption at Risk
US Commerce Department officials are in early talks to invest CHIPS Act funds into domestic quantum computing firms in exchange for equity stakes. This plan follows a 2025 deal where the government acquired a 10% stake in Intel, aiming to secure a competitive edge and bolster national security against China’s tech advances. However, quantum computing poses a growing threat to crypto encryption. Experts warn that advanced quantum computers could break RSA and ECC algorithms within five to ten years. Attackers may employ “harvest now, decrypt later” tactics by collecting encrypted data today for future decryption once quantum power matures. The crypto industry is accelerating development of post-quantum cryptography solutions, including lattice-based and hash-based signatures. Google’s 2025 quantum advantage report and warnings from Naoris Protocol’s CEO underscore the urgency. Industry groups and NIST are crafting quantum-resistant standards to protect Bitcoin and Ethereum. Traders should monitor crypto encryption standards, quantum computing policy developments and research on quantum-resistant encryption, and adopt quantum-safe protocols to safeguard digital assets.
Bearish
This news signals a significant long-term risk to crypto encryption, as government-backed quantum computing investments advance the timeline for practical quantum attacks. In the short term, market price impact may be limited by gradual policy implementation. However, traders will likely factor in heightened uncertainty and de-risk holdings by seeking quantum-resistant strategies, potentially exerting downward pressure on Bitcoin and Ethereum. The push for post-quantum cryptography underscores a material threat to existing encryption standards, suggesting a bearish outlook until effective quantum-safe solutions are widely adopted.