Justin Drake, a researcher at the Ethereum Foundation, has urged the crypto industry to prepare for a potential failure of the encryption protecting Bitcoin and Ethereum wallets. His warning differs from the long-standing concern over quantum computers: he says increasingly capable artificial intelligence could, in a worst-case scenario, recover private keys before quantum machines are ready.
According to Decrypt, Drake called for the industry to begin planning what he described as “bunker mode.” The proposed preparation would involve moving assets from self-custodied wallets that have already revealed their public keys into fresh addresses whose public keys remain concealed behind a cryptographic hash.
The warning comes as major crypto assets and exchange-traded funds face renewed selling pressure. It also raises a technical issue that matters to anyone holding coins directly: the security of a wallet can change once it has been used to send a transaction.
Why exposed public keys matter
Crypto wallets use a private key to authorize transactions and a related public key to verify them. Before a wallet sends funds, the public key is generally hidden behind a hash on the blockchain. Once the wallet makes a transaction, however, its public key becomes visible permanently.
Bitcoin and Ethereum rely on the Elliptic Curve Digital Signature Algorithm, or ECDSA, for this part of their security model. The concern is that an attacker who could calculate a private key from an exposed public key could potentially take control of assets held at that address. Wallets that have only received funds and have never sent a transaction do not expose their public keys in the same way.
Drake said it is now reasonable to consider the possibility that this protection could be defeated before quantum computers become capable of the same task. In the worst case described in his warning, he said the process could take months rather than years, with a large graphics-processing-unit cluster potentially recovering a private key in about a week.
His change in emphasis reflects the pace at which AI systems are handling difficult mathematical problems. Drake pointed to 722 mathematical results published by OpenAI on Tuesday and argued that the mathematical structure behind elliptic curves could contain patterns that a highly advanced AI system might exploit. He contrasted that with the hashing process used to conceal public keys, which is intended to resist this type of attack.
What Drake is asking the industry to do
Drake said the response should be deliberate rather than panicked. He called for a controlled migration of assets to fresh addresses and specifically named Binance, Bitbank, Robinhood, Bitfinex and Tether when asking major platforms to strengthen their cold-storage arrangements.
He also pointed to a group of Bitcoin addresses commonly associated with the cryptocurrency’s creator. About 20,000 addresses are believed to hold 50 BTC each and have exposed public keys, according to the material cited in his warning. Drake described these wallets as a possible first target for an attacker, calling them “Satoshi’s shield.”
The issue is not limited to Bitcoin. Because Ethereum also uses ECDSA, the same broad exposure applies to Ethereum addresses that have revealed their public keys. Europol separately said in two reports published Wednesday that crypto wallets are likely to be the main weak point in future quantum attacks. The agency said crypto would not simply collapse, but added that wallets with exposed public keys could not be repaired after an attack and would need to move their funds beforehand.
Drake’s warning included several possible approaches, including using exchange-traded products or established custodians, rather than holding assets directly. Those are options he mentioned in the context of reducing exposure to wallet-key risks; they do not remove the broader technological question facing the industry.
Markets remain under pressure
The warning arrived during a weak session for crypto and wider markets. The source market snapshot showed Bitcoin near $82,600, Ethereum at $2,540, Solana at $114 and HYPE at $86, with the major assets down between roughly 1% and 4%. Bitcoin exchange-traded funds recorded $485 million in net outflows on Wednesday, while Ethereum ETFs posted $161 million in outflows.
Moneyiar market data at 21:49 on October 8, 2026, showed:
- Ethereum at $2,470.95, down 3.71% over 24 hours and 8.20% over seven days.
- Shiba Inu at $0.0000052954, down 1.79% over 24 hours and 7.82% over seven days.
- Uniswap at $7.3363, down 5.22% over 24 hours and 18.59% over seven days.
- Pepe at $0.0000038221, down 5.76% over 24 hours and 13.22% over seven days.
The market backdrop also included higher oil prices and weaker stock futures in the source report. The immediate price moves do not establish a connection between the market decline and Drake’s encryption warning. Instead, they show that the technical risk discussion is unfolding while investors are already dealing with broader selling across digital assets.
For now, Drake’s message is a call to prepare for a possible future vulnerability, not a claim that ECDSA has already been broken. Its significance lies in the proposed timetable: an attack once viewed mainly through the lens of future quantum computing could, in his assessment, arrive sooner if AI systems make rapid advances in mathematical problem-solving.
