Jefferies’ Wood dumped Bitcoin. Not a fire sale, just a quiet exit. Smart money always has a reason. He’d been in early, riding the wave, but now he’s betting on dull gold. Says it’s about quantum computing. Sounds like science fiction, but in this business, tomorrow’s fiction is today’s margin call.
Wood’s newsletter, Greed & Fear, is aptly named. He’s swapping out 10% of his portfolio, figuring Bitcoin can’t hold value if some super-powered computer decides to crack its code. He thinks Q-day – the day the encryption falls – is closer than the techies admit. A hunch, maybe. Or maybe he just sees the writing on the wall.
The Algorithm and the Coin
It started back in ’94 with a mathematician named Shor. He cooked up an algorithm, a digital skeleton key, that could unlock Bitcoin’s security. Emphasis on ‘could.’ It needs a computer that doesn’t exist yet. But these things tend to arrive when you least expect them, like a bad debt collector.
The problem is the encryption. It’s the lock on the vault. Shor’s algorithm could pick it clean. As of now, the hardware isn’t there. But quantum computing isn’t shuffling papers. It’s moving fast, and when it arrives, it won’t send a postcard.
Deloitte figures about a quarter of all bitcoins – around $370 billion worth – are vulnerable. The older coins are the softest targets. Early days, security was an afterthought. Now it’s the whole game. Like building a fortress with cardboard boxes at first, then upgrading to steel.
There are fixes, of course. The developers are scrambling. But it’s a messy process. Some wallets are lost keys, some folks can’t agree on the best solution. It’s a bit like trying to herd cats during a thunderstorm.
Is the Panic Justified?
Don’t go running for the hills just yet. There’s a plan – BIP-360 – to migrate to safer addresses. But it’s complicated. Lost passwords, internal squabbles, the usual. And even if they fix Bitcoin, quantum computing isn’t just coming for crypto.
Banks, financial institutions, the whole system is vulnerable. Citigroup estimates a single attack could cost between $2 and $3.3 trillion. Bitcoin’s little potatoes in that kind of field. The real risk isn’t just losing your coins; it’s the systemic shock.
The hackers are already preparing. “Harvest now, decrypt later” is the game. They’re stockpiling data, waiting for the technology to catch up. It’s a long con, and Bitcoin is just one piece of the puzzle.
Long-term investors have time to watch, to assess. If the developers can’t deliver, there’s always an exit strategy. It’s a game of patience, and a healthy dose of skepticism.
A Measured Response
Crypto is a gamble. It should be a small part of your portfolio, a calculated risk. It’s young, volatile, and subject to the whims of regulators. Quantum computing is just another layer of complexity.
Bitcoin’s been holding around $90,000, so the Q-day risk hasn’t crashed the party yet. But Wood’s move is a warning shot. Institutional investors are the engine of this market, and their caution is worth noting.
They pushed the price to new highs in 2025, and they’ll be crucial for long-term growth. But panic selling rarely pays off. A solution might be forthcoming. And if not, there’s still time to cut your losses. In this business, time is the one thing you can’t afford to lose.
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2026-01-22 12:22