Analyst Explains: The Biggest Risk in Bitcoin Isn’t the Price, It’s Something Else

Charles Edwards, founder of Capriole Investments, explained that the real reason behind Bitcoin’s recent weak performance is not “loop theories,” but rather the quantum computing threat and debt-focused leverage risks (Digital Asset Treasures, DATs).

While cryptocurrency markets debate why Bitcoin has underperformed gold by 40%, a striking warning has come from renowned macro analyst Charles Edwards. Appearing on the Coin Bureau Podcast, Edwards listed the “existential” risks preventing Bitcoin from getting a share of the $115 trillion liquidity pie ahead of it.

According to Edwards, the number one reason Bitcoin lags behind gold and stocks is that the quantum computing threat has moved from being “theoretical” to becoming a “risk horizon.” Edwards identifies the period between 2025 and 2028 as a critical time when the probability of Bitcoin’s current cryptographic methods (ECC) being compromised could rise to 20-30%.

The analyst noted that giants like BlackRock have added “quantum risk” clauses to their ETF prospectuses, and figures like Vitalik Buterin have issued warnings on the subject, indicating that institutional investors are beginning to price in this risk. Edwards argued that Bitcoin urgently needs a code update (soft-fork) to make the network quantum-resilient, and that with concrete steps in this direction, Bitcoin could quickly surpass gold.

Edwards noted that the global money supply had reached a record high of $115 trillion, adding that gold had risen by absorbing this liquidity, but Bitcoin was being pressured by the debt burden accumulated through “Digital Asset Treasures” (DATs).

Edwards noted that nearly 200 companies (DATs) similar to MicroStrategy have borrowed to buy Bitcoin, a situation reminiscent of the pre-crash period of the 1920s. Rising debt levels create a risk of a “leveraged cascade” (chain liquidation) in the Bitcoin price.

Referring to the widespread expectations of a halving cycle in the market, Edwards said, “The four-year cycle is now dead.” Arguing that Bitcoin is now more dependent on macro liquidity and institutional demand than a miner cycle, the analyst warned investors with the following words:

“If quantum risk isn’t resolved this year, gold may continue to outperform Bitcoin. However, if a roadmap is agreed upon, the ‘risk discount’ on Bitcoin will disappear, and a massive rally will begin.”

*This is not investment advice.