Quantum risk is back at center stage — and the timing couldn't be worse for bitcoin. New research from Google's Quantum AI team warns that Taproot, bitcoin's own privacy upgrade, may be widening the pool of vulnerable wallets, and that a real-time attack could hijack an in-flight transaction in roughly nine minutes. Meanwhile the FTX Recovery Trust distributes $2.2 billion to creditors today, and the U.S. Labor Department just proposed a rule that would open trillions in 401(k) funds to crypto.
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Google says Taproot could let quantum attackers crack Bitcoin in 9 minutes
Google's Quantum AI team published new research Monday warning that breaking Bitcoin's cryptography may require far fewer qubits than previously thought — as low as 1,200–1,450 high-quality qubits for practical attacks. A separate Caltech/Oratomic paper found crypto wallet encryption could be broken with just 10,000 physical qubits. The concern: Taproot's default public key visibility may widen the pool of vulnerable wallets, and an in-flight transaction could be hijacked in roughly nine minutes. Google stresses attacks aren't imminent, but urges earlier post-quantum migration.
FTX distributes $2.2B to creditors today. Will they buy back in?
The FTX Recovery Trust distributes approximately $2.2 billion to creditors today — the largest single payout from the bankrupt exchange to date. The key market question: how much of that capital gets recycled back into crypto versus cashed out entirely? Prior FTX distributions have had mixed price impacts, and analysts note the broader market backdrop remains fragile with bitcoin down on the day and ETF outflows resuming. A meaningful re-entry from creditors could provide a short-term bid, but the timing is complicated by the war premium still embedded in risk assets.
U.S. Labor Department proposes rule to open 401(k)s to crypto
The Department of Labor has proposed a rule that would allow 401(k) plans to include alternative assets like cryptocurrency, private equity, and real estate — directly executing a Trump executive order from August. The proposal reverses Biden-era guidance that warned fiduciaries against offering crypto in retirement accounts. Labor Secretary Lori Chavez-DeRemer said the change seeks to enable investment in products that better reflect the current landscape. Critics, including Sen. Elizabeth Warren, warn it could expose retirement savers to elevated risk. The rule now enters a public comment period before potential finalization.
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