A report released by the Coinbase Advisory Board warns of an impending quantum computing threat, urging the cryptocurrency industry to develop response strategies as soon as possible.

On April 22, a 50-page report commissioned by Coinbase pointed out that although current quantum computers are not yet powerful enough to crack the encryption technologies used in Bitcoin, Ethereum, and other networks, large-scale fault-tolerant quantum computers will eventually be developed. The cryptocurrency industry must begin preparations now. The report was authored by an independent advisory board, whose members include cryptographers and academics such as Dan Boneh from Stanford University, Justin Drake from the Ethereum Foundation, and Sreeram Kannan from Eigen Labs. The report estimates that it may take several years to over a decade for quantum computers to break current encryption standards. The U.S. National Institute of Standards and Technology recommends transitioning to quantum-resistant cryptography by 2035, but the report considers this timeline potentially optimistic. While quantum-resistant cryptography already exists and is being standardized, post-quantum digital signatures could be tens to hundreds of times larger than existing signatures, potentially increasing block sizes by up to 38 times and presenting challenges such as wallet migration. The Ethereum Foundation has proposed a quantum-resistant digital signature scheme, while Solana and others are testing quantum-resistant wallet designs. The report suggests adopting flexible transition strategies, such as hybrid systems, to avoid compromising current security while preparing for future upgrades.