New IBM Quantum Breakthrough Shrinks Timeline to Crack Bitcoin Encryption

Researchers at International Business Machines (IBM) have achieved a record-setting 120-qubit entangled state, marking a significant hardware advance that shrinks the theoretical timeline for a full-scale quantum attack on digital assets. The breakthrough directly heightens the vulnerability risk for an estimated $767 billion pool of Bitcoin (BTC) that security experts classify as exposed to future quantum threats to Bitcoin encryption.

The experiment, detailed in the paper “Big Cats: Entanglement in 120 Qubits and Beyond,” confirms the ability to maintain genuine multipartite entanglement across all qubits. This is a critical engineering milestone toward developing the fault-tolerant systems required to break current cryptography.

The IBM Quantum achievement of scaling the system while maintaining a fidelity of 0.56 confirms the capability of generating complex quantum resource states, a core requirement for deploying Shor’s algorithm, which can quickly factor the large numbers that secure modern encryption.

Quantifying the Financial Risk to Bitcoin Encryption

While the current 120-qubit system is not computationally powerful enough to break 256-bit encryption, its progress accelerates the policy debate around digital asset security. According to data cited by quantum computing research group Project 11, approximately 6.6 million BTC have already exposed their public keys, making them vulnerable if quantum computing reaches sufficient scale.

Using market data where BTC traded at approximately $116,000 per coin, this vulnerable supply represents a potential liability of $767 billion. This pool includes the unmovable coins held by Bitcoin creator Satoshi Nakamoto, whose security relies entirely on the strength of Bitcoin encryption.

Project 11 founder Alex Pruden identified this vulnerable supply as one of “Bitcoin’s biggest controversies.” Pruden stated the dilemma for these assets is clear: “Do you burn it, redistribute it, or let a quantum computer get it?”

Technical Achievement of IBM Quantum

The IBM Quantum advance, which surpasses the 105-qubit Willow chip benchmark set by Google Quantum AI in 2024, utilized advanced noise-suppression techniques, including “uncomputation,” to stabilize the delicate quantum state. The team successfully entangled the superconducting qubits in a Greenberger–Horne–Zeilinger (GHZ) state—a collective superposition often referred to as a “cat state.” 

The high fidelity score of 0.56 proved that every qubit remained part of a single, coherent system, according to the researchers. Because simulating the full state of 120 qubits is computationally impossible, IBM utilized statistical methods like Direct Fidelity Estimation to verify the achievement. This verification step is crucial, demonstrating scalable methods for proving the integrity of future, even larger quantum devices.

Industry Timeline and Post-Quantum Security

Experts maintain caution regarding the immediate threat. River CEO Alexander Leishman noted that while he is “skeptical it’s a near-term problem,” he warned that a scaled quantum computer “WILL magically give you access to many billions of dollars worth of Bitcoin.”

IBM’s internal roadmap targets the creation of viable fault-tolerant quantum systems by 2030, which the firm states is the timeline when organizations must complete their migration to post-quantum security measures. Current estimates suggest approximately 4,000 logical qubits are needed to pose a practical threat to Bitcoin encryption.

Chain Street’s Take:

IBM’s 120-qubit entanglement milestone doesn’t break Bitcoin today, but it resets the countdown clock. The line between theoretical and practical quantum threat is narrowing, and digital asset security is no longer an abstract debate. 

For a $767 billion pool of exposed Bitcoin, the question isn’t if migration to post-quantum systems happens, it’s whether it happens fast enough.