The White House convened more than 100 quantum computing executives and researchers two days ago for what attendees called the most crowded quantum summit of its kind—a sign of how urgently Washington is treating a technology that could crack the encryption protecting trillions of dollars in digital assets and reshape global manufacturing.
The summit came after a burst of federal activity. The Department of Commerce announced two months ago that it plans to provide more than $2 billion in incentives to support nine quantum-focused companies. Days ago, President Donald Trump signed two executive orders aimed at boosting quantum development and preparing federal systems for quantum-enabled cyberattacks. One of those orders indicated that information from the Quantum Benchmarking Initiative will inform how the government builds out supply chains for quantum computer hardware.
But the real urgency isn't abstract. It's existential for cryptocurrency holders. Research from March suggests quantum computers may be able to break the cryptography protecting digital wallets much sooner than previously expected—potentially by 2029 instead of a decade away. That timeline has sent shockwaves through an industry built on encryption that's now looking vulnerable.
The Crypto Vulnerability
The $2 trillion global cryptocurrency market relies on decades-old elliptic-curve cryptography to generate the public and private keys that verify ownership and authorize transactions. Here's the problem: once a transaction happens, the public key becomes visible on the blockchain. A sufficiently powerful quantum computer could derive private keys from those public keys, allowing hackers to forge digital signatures and steal funds.
Bitcoin faces particularly acute risk. Its 17-year history of transactions has generated a large number of visible public keys. An unpublished June working paper by independent researcher Ahmed Raza Muhammad Umer estimates roughly 35% of bitcoin's circulating supply could be exposed to a quantum computing attack. Other research has estimated that figure could be as high as 50%.
Cristiano Ventricelli, vice president and senior analyst of digital assets at Moody's Ratings, warns that even a single major theft could collapse confidence in entire networks. "Everyone will feel the impact," he said. Christopher Wood, the closely tracked global head of equity strategy at Jefferies, removed a 10% bitcoin allocation from his model portfolio in January specifically because of the long-term "existential" threat of quantum computing.
Crypto companies are scrambling to upgrade their networks with quantum-resistant cryptography—a potentially years-long effort that could require sweeping changes to the infrastructure underpinning digital assets. Chris Tam, head of quantum innovation at BTQ Technologies, which focuses on quantum security, called it "the most direct and existential threat towards cryptocurrencies and crypto networks."
One senior cybersecurity executive at a major crypto player said he expects it will take two years for his company to become fully quantum-resistant. Others described the potential work as akin to a Y2K-style overhaul when more than $300 billion was spent globally fixing the "millennium bug." The problem is especially thorny for blockchains, which are mostly decentralized, meaning they're operated by communities that may not be able to agree on a path forward.
None of the top 20 blockchains have implemented a post-quantum signature algorithm. In the case of bitcoin, developers and market participants are divided over which fix to adopt and when to move. The Ethereum Foundation, which supports the blockchain that underpins ether, the second-largest cryptocurrency, says it's targeting 2029 for full protection from quantum computing.
Zach Pandl, head of research at crypto asset manager Grayscale, notes that post-quantum digital signatures are generally much larger than traditional signatures, increasing storage and bandwidth requirements. They could raise costs and degrade user experience, particularly on blockchains with fixed block-size limits, such as bitcoin. "There is an engineering challenge ahead, but there are engineering solutions already on the table," Pandl said.
Some companies are moving faster than others. The Algorand Foundation, which supports the Algorand blockchain with a market capitalization of around $780 million, published a post-quantum roadmap one month ago and plans to start supporting post-quantum accounts later this year. "It felt right to start doing something now, because it's responsible to have a plan," said Bruno Martins, Algorand Foundation's chief technology officer.
The Government's Reality Check
Meanwhile, the federal government is trying to get a clear-eyed assessment of whether quantum computing will actually deliver on its promises. The Quantum Benchmarking Initiative, or QBI, a Defense Advanced Research Projects Agency program, is examining the feasibility of building "utility-scale, fault-tolerant quantum computers" by 2033—machines that would be cost-effective and able to operate despite computational and hardware imperfections.
A DARPA spokesperson said the initiative aims to "provide the U.S. government with the best possible assessment of the current state of commercial quantum computing and its likely trajectory, so that those stakeholders can make informed decisions." The agency estimates it's more likely than not that at least one company will be able to create an industrially useful quantum computer by 2033, though that outcome isn't guaranteed.
Joe Altepeter, the founding program manager of QBI, told a December quantum industry conference that the agency is fully prepared to accept that the goal might not be achievable. "Our job is to prevent surprise and give ground truth to the U.S. government to make wise decisions," Altepeter said. "And we are perfectly fine if the answer is: 'No one's going to be able to build this. We should spend our money building giant robots or curing cancer instead—don't worry about quantum computing.'"
Undersecretary of Defense Emil Michael attested to QBI's rigor at the White House summit. A White House official said QBI will inform the Defense Department's efforts to bolster supply chains and its understanding of quantum computing. The official added that the June executive order focuses on developing scientifically useful quantum technology in the near term, while QBI is assessing long-term commercial viability.
Paul Lekas, the Software & Information Industry Association's global public policy and government affairs head, said the U.S. quantum effort would likely keep momentum even if QBI concludes the 2033 timeline isn't feasible. "You're going to continue to see interest because of all the potential applications as well as the concerns that if the United States doesn't get there first, we are potentially vulnerable to what potential adversarial actors can do with those capabilities," Lekas said. "I don't think you're going to see scientists and the private sector and government say, 'OK we're going to pause what we're doing right now and wait.'"
David Bernal Neira, a Purdue University chemical engineering professor who studies quantum, said there's general consensus that building such a computer is possible—it's just a matter of when. "I see QBI as an accelerator and as a field for an already ongoing competition to happen, whether or not the goals are achieved by the deadline that has been set," Neira said. "If this goalpost of 2033 is not achieved, I still think that we will be at a stage that is much, much closer than where we are right now."
Supply chains themselves may need to be tailored to whichever approaches QBI determines to be viable. Some approaches rely heavily on lasers while others require more cooling equipment or helium. "When you go into the question of what it means for them to be at the utility scale, that's a supply chain question," Neira said.
Europe's Chip Inspection Play
While Washington focuses on quantum development, Europe is backing a different quantum application: chip manufacturing. QuantumDiamonds, a German startup applying a novel approach to inspecting semiconductor defects, received €76 million in non-dilutive funding one day ago, approved by the European Commission and provided by Germany's federal economy ministry and the state of Bavaria. The funding will support a new facility for producing semiconductor testing equipment in Munich.
The company is a spinout from the Technical University of Munich and has also raised a €15 million equity round led by VC firm World Fund. The round was backed by Bayern Kapital and existing investors including Creator Fund, Earlybird, First Momentum, IQ Capital, Onsight Ventures and UnternehmerTUM.
QuantumDiamonds compresses a defect detection process that usually takes weeks into a two-minute inspection that doesn't stop production lines. CEO Kevin Berghoff said the company claims it can help major chipmakers like Taiwan-based Foundries and Korea's Memory Makers save hundreds of millions of dollars. The hardware is typically paid back entirely within a couple of months. The startup also charges subscription fees for on-site support and software that interprets data and indicates what manufacturers should address in their processes.
Berghoff said quantum sensing is already operational in its ability to generate magnetic fields that detect defects with high precision. QuantumDiamonds uses synthetic diamonds and their properties to observe how electricity flows through chips. Compared with current inspections that look at the top layer with a microscope, this approach can detect defects through all layers without destroying the chip.
The capability is particularly relevant as chips become increasingly multi-layered. Startups such as Semron have been developing 3D chips, and the industry seems to agree this is the path forward for AI data centers. "The thing is that the transistors cannot get smaller, so in order to get the same power and the same compute, you start to add more and more layers," Berghoff said.
Large competitors including "100 billion market-capped U.S.-based inspection companies" will likely adapt eventually, but QuantumDiamonds has first-mover advantage. "There is no U.S. or Asian company that has shipped those tools," Berghoff said. The startup is already moving from clients' labs to their manufacturing plants. Lab tools cost single-digit millions, while high-throughput systems could reach $10 million to $15 million—still far below ASML machines that cost around $400 million.
Daria Saharova, World Fund managing partner, wrote that QuantumDiamonds "can become Europe's next ASML." Berghoff said the company may be more akin to IQM, the Finnish quantum spinout that recently went public, leveraging European support and funding to go global. QuantumDiamonds has opened a regional hub in Taiwan and completed its first commercial deployments in Taiwan and the U.S., installing a system at Eurofins EAG Laboratories in Sunnyvale, California.
The new funding will also generate jobs in Munich, where most of QuantumDiamonds' team of 70 people is based. Berghoff and co-founder and CTO Fleming Bruckmaier plan to double the engineering team over the next 12 months, taking advantage of affordable talent with both quantum and semiconductor expertise. "We have what we need here to ship overseas," Berghoff said.
Why This Matters:
Quantum computing represents one of the defining technological challenges of the next decade, and how governments and markets respond will shape everything from financial security to industrial competitiveness. The crypto vulnerability is immediate and concrete: trillions in digital assets face genuine risk if quantum computers arrive faster than expected, and the decentralized nature of blockchain networks makes coordinated defense difficult. This isn't theoretical—it's a coordination problem that requires collective action across fragmented systems.
Meanwhile, the federal government's honest assessment through QBI reflects a center-left approach to industrial policy: rigorous public evaluation of what's actually achievable, willingness to redirect resources if targets prove unrealistic, and integration of supply chain planning into long-term strategy. The $2 billion in Commerce Department incentives represent strategic public investment in a field where private markets alone won't generate the infrastructure needed.
Europe's backing of QuantumDiamonds signals something different: recognition that technological leadership requires sustained public support for innovation ecosystems, not just individual companies. The €76 million in non-dilutive funding allows the startup to scale without surrendering control to private equity, keeping European capacity in advanced manufacturing intact. As global supply chains fragment and technological competition intensifies, this kind of strategic public investment in manufacturing capability may prove as important as the quantum computers themselves.