Terrifyingly Delicious About Quantum, US Investment Bank Withdraws from Bitcoin
Global Equity Strategy Head at investment bank Jefferies Christopher Wood has removed the entire 10% Bitcoin (BTC) allocation from his model portfolio due to concerns over the developments in quantum computing.
In the Greed & Fear newsletter cited by Bloomberg, he assessed that advancements in technology could potentially threaten the long-term security of the world's largest crypto asset.
The Bitcoin position that was sold has since been redirected to physical gold and shares of gold mining companies, assets that are considered to have a longer and more stable track record.
Wood had previously invested in Bitcoin since late 2020 and even increased her stake in 2021, with the belief that crypto could become "digital gold" amidst the flood of central bank stimulus during the pandemic.
However, Wood now emphasizes that her concerns are more fundamental, namely regarding the existential risk to Bitcoin's function as a store of value. She believes that quantum breakthroughs could undermine Bitcoin's cryptographic system.
Nevertheless, several experts believe that this threat is not urgent, with Blockstream CEO Adam Back stating that quantum risks will only become relevant in 20–40 years and can be anticipated through post-quantum encryption standards.
Although skepticism remains dominant, Wood's actions indicate that this issue is beginning to influence asset allocation decisions, as some countries like El Salvador are also taking preventive measures to secure their Bitcoin holdings.