More than 6 million bitcoin are associated with public keys that are currently visible on-chain, raising concerns about potential vulnerabilities if AI or quantum computing advances undermine Bitcoin's cryptographic security.
Growing Exposure of Public Keys as AI Threats Loom
According to recent data from Glassnode, these exposed bitcoins account for 31.2% of the circulating supply, which is approximately 5 to 6 percentage points higher than the lows observed earlier in 2023.
Rafael Schultze-Kraft, co-founder of Glassnode, noted that the exposed supply has increased by 222,000 BTC (valued at $18.2 billion) since the company's report in May, while the overall bitcoin supply has only risen by 64,000 BTC during the same period.
Currently, exchanges are holding 1.79 million BTC that are linked to visible public keys, with Coinbase showing 10% exposure and Binance at a staggering 83%.
In addition to exchanges, Fidelity has approximately 375,000 BTC, with only 2% exposed. Other entities include Grayscale, which has 49% exposed, while Revolut and Robinhood show much higher exposure rates of 99% and 100%, respectively. Notably, government holdings from the U.S., U.K., and El Salvador show no exposure under this analysis.
Non-Exchange Entity BTC Balances by Public-Key Exposure (Glassnode)Public keys can become exposed due to address reuse or through specific bitcoin output types, including early pay-to-public-key outputs and Taproot. An advanced quantum computer or a significant mathematical breakthrough could theoretically enable an attacker to derive private keys from these public keys.
This news coincides with warnings from Ethereum researcher Justin Drake, who has urged the crypto community to adopt “bunker mode” in preparation for possible AI-related attacks. Drake emphasized that AI could potentially find a way to compromise wallet cryptography in a matter of months rather than years, prior to the arrival of quantum computing.