Galaxy Digital: $9B Bitcoin Sale Not Driven by Quantum Fears, Company Says

Galaxy Digital publicly rejected social-media narratives that a roughly $9 billion single-client Bitcoin liquidation was driven by panic over quantum-computing vulnerabilities, saying the trade reflected client-specific decisions rather than a sectorwide flight. The clarification accompanied a quarterly filing showing material fourth-quarter and annual losses, intensifying scrutiny of the firm’s execution and balance-sheet resilience. Prices moved briefly, with Bitcoin slipping under about $74,000 as market participants parsed the large sale alongside macro and regulatory noise. Outside the headlines, recent research from institutional teams and vendors frames the quantum threat as conditional and multi-year rather than an immediate network-wide collapse. That work highlights a key technical point: only outputs tied to already-exposed public keys are meaningfully at risk, so vulnerability is uneven across supply. Industry prototyping — including Bitcoin-compatible testnets that swap elliptic-curve signatures for lattice-based primitives — has surfaced practical trade-offs such as larger signature sizes, higher blockspace use and adjustments to node verification and fee dynamics; one experiment ran with a 64 MiB block limit to preserve throughput. Estimates of how many bitcoins sit in vulnerable output classes vary widely (from low millions up to higher multi-million estimates), and expert timelines range from several years to multiple decades. Protocol teams and major foundations have launched cross-discipline post-quantum programs and devnets to evaluate migration primitives, while custodians and funds are running sandbox experiments and hedging strategies. Practical mitigations in circulation include avoiding key reuse, rotating addresses, PQ-ready custody frameworks, precompiles or account-abstraction pathways, signature-aggregation or compression schemes, and emergency migration playbooks designed to limit privacy leakage. The Galaxy episode underscores how narrative risk — technical hypotheticals, concentrated flows, and regulatory uncertainty — can amplify short-term volatility even when the proximate cause is idiosyncratic. For investors and infrastructure operators, the takeaway is twofold: monitor concentrated-holder activity and firm-level execution risks, and follow concrete protocol- and custody-level work on post-quantum migration, which will determine whether the sector can stage a smooth transition or face costly disruption. Meanwhile, U.S. market-structure and regulatory discussions remain an important backdrop that could either improve liquidity and confidence or prolong uncertainty.