Source: decrypt

Written by: Jason Nelson

Translated by: Deloris

Saudi Arabia has joined the global quantum computing race.

State-owned energy and chemical company Saudi Aramco announced on Monday that it has installed the first quantum computer in Saudi Arabia, further intensifying the security risks facing Bitcoin and other blockchain networks.

Saudi Aramco stated that the 200-qubit quantum computer, manufactured by the French neutral atom quantum computing company Pasqal, has been installed at its own Dhahran data center, which is specifically designed for industrial applications such as energy modeling and materials research.

Pasqal claims that this is the most powerful system the company has delivered to date. Quantum bits (qubits) are the fundamental units of quantum computers.

Loïc Henriette, CEO of Pasqal, stated in a press release, "Deploying our most powerful quantum computer to date is historically significant and marks a milestone for the future of quantum in the Middle East. Pasqal continues to expand its business footprint, providing practical quantum computing capabilities for the industrial sector." This move by Saudi Arabia places it alongside countries such as the United States, China, the European Union, the United Kingdom, Japan, India, and Canada—all of which have funded national-level quantum programs aimed at expanding research infrastructure and cultivating the talent needed for future fault-tolerant systems.

Quantum computing appears to be advancing faster than expected. In a blog post on November 13, quantum computing researcher Scott Aaronson (the Schlumberger Centennial Chair Professor in the Department of Computer Science at the University of Texas at Austin) wrote, "Given the astonishing pace of current hardware development, it is quite likely that a fault-tolerant quantum computer capable of running Shor's algorithm will be built before the 2028 U.S. presidential election."

Experts warn that once quantum computers become powerful enough to break encryption systems, they could expose private keys or forge signatures, allowing attackers to steal funds or undermine privacy protection mechanisms.

In fact, this is a particular concern for cryptography practitioners. On November 17, during the Devconnect conference in Argentina, Ethereum co-founder Vitalik Buterin warned in a speech about the Ethereum roadmap that quantum computing could threaten the foundations of the crypto space—elliptic curve cryptography.

But the question remains: is this a serious threat or a blind attempt?

Auh, founder of Bolt Technology, stated that as quantum computing technology achieves repeated breakthroughs, its rapid development forces the security community to confront this threat.

He said, "With such massive investments and influx of funds, breakthroughs will eventually come. While no one knows the exact timing, the threat is no longer theoretical. Although current technology still cannot break elliptic curve cryptography (ECC) or RSA algorithms, progress is steadily advancing."

Auh noted that national-level investment motivations are not limited to cryptanalysis.

"Quantum computing is the first technology that could become a global digital weapon not controlled by any political system," he pointed out.

However, there is still a long way to go before cracking Bitcoin; this research has a long road ahead.

According to research scientist Ian McCormack, a 200-qubit system is relatively small in practical applications because current machines are limited by noise and short coherence times, resulting in a limited number of executable operations.

"200 qubits are enough for some interesting experiments and demonstrations—provided the qubit quality is high enough, but even with such a small number, it is difficult to achieve. However, this is far from sufficient for error-correcting calculations, and executing Shor's algorithm requires exactly that computational capability," he explained. This quantum algorithm is used for integer factorization.

In September, researchers at Caltech announced a neutral atom system with 6,000 qubits.

However, even machines of this scale are still used for research, simulation, and algorithm development, rather than for attacking cryptography.

Caltech graduate Eli Batayeh stated, "What you need is a very long coherence time, much greater than your operation duration. If your operation duration is one microsecond and your coherence time is one second, that means you can perform about a million operations."

Researchers indicate that to threaten modern cryptography, thousands of error-correcting logical qubits are needed, equivalent to millions of physical qubits.

Although the Pasqal system has not changed the current security of blockchain, it has reignited concerns about a long-term risk known as "Q Day," the moment when quantum computers are powerful enough to derive private keys from public keys and forge digital signatures.

Worryingly, this capability would not only undermine the cryptographic technology used by Bitcoin but also compromise many security systems that underpin the global economy.

"What quantum computers can do—this is closely related to Bitcoin—is forge the digital signatures currently used by Bitcoin," said Justin Taylor, research partner at the Andreessen Horowitz fund and associate professor at Georgetown University. "A person with a quantum computer could authorize a transaction and take all the Bitcoin from your account without your authorization. That is the most terrifying aspect."

Today's most advanced processors, such as the 200-qubit Pasqal machine and Google's 105-qubit Willow chip, still fall far below the attack threshold.

"Quantum computing has a significant probability (over 5%) of posing a major or even existential long-term risk to Bitcoin and other cryptocurrencies," mentioned Christopher Peikert, a professor of computer science and engineering at the University of Michigan. "But in the next few years, this is unlikely to pose a real risk; quantum computing technology still has a long way to go before it threatens modern cryptography."

Compared to the distant threat of quantum computing, Bitcoin faces more immediate challenges.

The market is continuing to deteriorate; last Friday, the price of Bitcoin plummeted again to $82,000. Although it has slightly rebounded now, it has only returned to $87,000, nearly a 30% drop from its historical high.

More concerning is that, according to market reactions, this decline may continue. Funds are continuously flowing out. From the ETF perspective, the outflow of Bitcoin exchange-traded funds (ETFs) in November reached $3.5 billion, marking the largest single-day outflow since February. "This indicates that institutional investors have stopped allocating Bitcoin," said Marcus Tielen, founder and CEO of 10X Research. "ETF institutions have turned into sellers, and as long as they continue to sell, I believe the market will struggle to maintain an upward trend or rebound."

The retreat of crypto treasury companies, which heavily rely on the appreciation of coin values, is even more evident. According to the Financial Times, as the cryptocurrency market faces a severe setback, companies that once hoarded crypto assets to bolster their treasuries are facing a dual blow from stock prices and coin prices. To support their declining stock prices, these companies are being forced to sell their held digital tokens. North Carolina-based Ether holder FG Nexus recently sold about $41.5 million worth of tokens to fund its stock buyback plan. The company's market value is $104 million, below its $116 million in crypto assets. Florida-based life sciences company ETHZilla also sold about $40 million worth of tokens for stock buybacks.

Retail investors are also showing a defensive stance. Data released by Santiment indicates that since November 11, the number of wallets holding at least 100 Bitcoins has increased by 0.47% (91 wallets). Meanwhile, the number of small wallets (especially those holding 0.1 Bitcoin or less) has been decreasing.

Of course, there are still some optimistic messages; the Federal Reserve's monetary policy is showing a more "dovish" stance. According to CME's "FedWatch": the probability of the Federal Reserve cutting rates by 25 basis points in December is 84.9%, while the probability of maintaining rates is 15.1%. The probability of the Federal Reserve cumulatively cutting rates by 25 basis points by January next year is 66.4%, with a probability of maintaining rates at 11.1%, and a cumulative cut of 50 basis points at 22.6%.

With various factors intertwining, market predictions are becoming increasingly difficult. However, from the traders' perspective, it is generally believed that the market will enter a consolidation phase, with $90,000 becoming a key threshold.

Beimnet Abebe, head of credit trading at Galaxy Digital, stated that they believe the peak of this cycle has likely been established. In the short term, it is difficult for prices to return to the $120,000 to $125,000 range. For now, the $90,000 level is likely to pose strong resistance.

Coindesk analyst Omkar Godbole noted that the first resistance level Bitcoin is focusing on is the 200-hour simple moving average (SMA), currently close to $88,000. Since Monday, this level has been acting as a resistance point for price increases, limiting the upward movement. The next resistance level to watch is in the $98,000–$99,000 range, which previously formed intraday lows earlier this month and in June of this year.

Additionally, the most critical support level is around $83,680, where the 100-week SMA intersects with a macro bullish trend line. If this level is breached, it will send a clear risk signal, confirming a recent bearish shift and potentially leading to a deeper decline. The next stop-loss support is around $74,500, where selling pressure eased in early April, paving the way for subsequent price rebounds.

Delphi Digital analyst that1618guy proposed two scenarios: in an optimistic scenario, the market could break through $103,500 after completing a correction, while in a pessimistic scenario, the rebound could be blocked in the $95,000 to $99,000 range, followed by a drop to around $75,000.

Even the usually optimistic Arthur Hayes has taken a different stance, believing that Bitcoin prices will remain below $90,000 and may retest the effective support level of $80,000.

More pessimistic crypto analyst @ali_charts even suggested that key support levels could be at $75,740, $56,160, and $52,820.

Of course, there are still institutions with an optimistic outlook, but they are more focused on ETH. Liquid Capital founder Yi Lihua stated on social media today, "From the investment research data, ETH is being heavily shorted by multiple platforms and institutions. I believe that after surviving the toughest November, it may usher in a short squeeze. Compared to ETH four years ago, the favorable environment of stablecoins/ETFs/DAT/policies is on a completely different level, and ETH is severely undervalued."

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