Project Eleven raises 20 million! CEO warns that Bitcoin quantum threat will become a reality within 5 years

Project Eleven completes $20 million funding round (valuation $120 million), with Castle Island leading the investment and Coinbase Ventures participating. The CEO states there is real risk within 5 years. Has tested migration with Solana and plans for a self-custody product. BlackRock ETF warns: quantum computing could render Bitcoin encryption ineffective. Bitcoin without a leader faces upgrade challenges.

5-Year Countdown Alarm Behind $20 Million Funding

According to an exclusive report by Axios Pro, the startup Project Eleven, dedicated to protecting cryptocurrencies from quantum computing threats, has raised $20 million, valuing it at $120 million. Castle Island Ventures led the Series A funding, with Coinbase Ventures, Fin Capital, Variant, Quantonation, Nebular, Formation, Lattice Fund, Satstreet, Nascent Ventures, and former Coinbase CTO and crypto thought leader Balaji Srinivasan also investing.

Quantum technology could potentially break the underlying cryptography that secures encryption—this has caused significant concern in the industry. The fundamental principle of encryption is that traditional systems take a long time to crack codes. But quantum computing can perform complex calculations much faster than classical computers. So far, Bitcoin investors have viewed quantum computing as a theoretical future problem. However, recent progress has led more and more people to believe that the realization of quantum computing has been significantly shortened.

“Unless I believe there is a real risk within the next five years, I wouldn’t do this,” said Project Eleven CEO Alex Pruden. “The development speed of quantum technology is much faster than people imagine.” The five-year timeframe is extremely critical. If quantum threats only become real after 10 or 20 years, the crypto community has ample time to upgrade. But if, as Pruden suggests, only five years remain, urgent action must be taken now, or it may be too late.

Three Major Validation Signals for Project Eleven’s Funding

Castle Island Leading Investment: Castle Island is a top-tier crypto-focused VC known for cautious investment decisions.

Coinbase Ventures Participating: The strategic investment arm of industry giant Coinbase recognizes the reality of quantum threats.

Balaji’s Personal Bet: Former Coinbase CTO and crypto thought leader Balaji Srinivasan is personally betting with his own funds.

The investment lineup itself underscores the seriousness of the issue. These institutional investors and individuals are among the smartest funds in crypto; their willingness to invest in Project Eleven indicates that quantum threats have shifted from “science fiction” to “a real problem requiring commercial solutions.” The $120 million valuation also reflects market recognition of this sector’s potential. If quantum protection becomes a necessity for all crypto assets, Project Eleven’s business prospects could be vast.

Pruden said that if you ask any expert when quantum technology will crack Bitcoin’s encryption, you’ll get answers ranging from two years to fifty years, “no one really knows.” “Even if it happens later rather than sooner, we still need to be prepared,” said Nic Carter of Castle Island. This uncertainty itself is a risk; when the consequences are severe, even low probability events must be proactively addressed.

Dual Defense: Solana Testing and Self-Custody Products

Pruden states that Project Eleven aims to be a “bridge” to the quantum future. Cryptocurrency protocols are decentralized and consensus-based, meaning that to migrate users to “quantum-resistant” addresses, everyone holding the asset must transfer their cryptocurrencies. For Solana and other cryptocurrencies with some form of leadership, this problem is relatively easier to solve. Project Eleven has collaborated with Solana to test the feasibility of a world migration where quantum computing becomes a major issue.

Solana’s testing may include simulating migration processes, evaluating the performance impact of new cryptographic algorithms, and testing compatibility with existing applications. Due to its high performance and active developer community, Solana is an ideal platform for quantum-safe upgrades. If Solana successfully completes a quantum-resistant upgrade, it could serve as a replicable template for other blockchains.

However, Bitcoin currently has no clear leader. Past attempts to fundamentally change its underlying protocol have been highly controversial. This is both Bitcoin’s strength (decentralized resistance to censorship) and its weakness (difficulties in upgrading). When facing existential threats requiring urgent upgrades, Bitcoin’s consensus mechanism could become a fatal weakness.

In addition to direct protocol collaboration, Project Eleven plans to create a self-custody product for the post-quantum era, so that even if the underlying protocol lacks quantum resistance, users’ cryptocurrencies can still be protected. This dual defense strategy is highly wise. Protocol layer upgrades are the most thorough solution but require full network consensus and a lengthy implementation cycle. Self-custody products can be deployed quickly, providing immediate protection for users unable to wait for protocol upgrades.

Such a self-custody product might operate as follows: users transfer Bitcoin from old addresses to addresses provided by Project Eleven, which use post-quantum cryptographic algorithms (such as hash-based Lamport signatures or NIST-standardized SPHINCS+). Even if the Bitcoin mainnet still uses ECDSA, which is vulnerable to quantum computers, assets in Project Eleven addresses remain secure.

BlackRock ETF Warning and Political Dilemma of Bitcoin Upgrades

BlackRock explicitly states in its Bitcoin ETF filings: “Quantum computing could potentially render the cryptographic techniques underlying the Bitcoin network ineffective.” This warning appears in the legal documents of the world’s largest asset manager, carrying significant weight. BlackRock is not a sensationalist media outlet or a startup selling products; it manages over $10 trillion in assets and has fiduciary responsibilities to investors. Mentioning quantum risks in its ETF filings indicates that its legal and risk management teams consider this a material risk that must be disclosed to investors.

This institutional-level warning could catalyze Project Eleven’s commercialization. When giants like BlackRock and Fidelity’s compliance departments demand “quantum risk hedging solutions before increasing Bitcoin holdings,” Project Eleven’s products will become a necessity. This shift from “technical solution” to “regulatory requirement” could open a multi-billion-dollar market for Project Eleven.

Pruden said that if you ask any expert when quantum technology will crack Bitcoin’s encryption, you’ll get answers from two years to fifty years, “no one really knows.” Nic Carter added, “Even if it happens later rather than sooner, we still need to be prepared.” Managing this uncertainty is core to the insurance industry’s logic: when losses are huge, even very low probabilities justify insurance.

Project Eleven is not the only company exploring quantum protection technology. BTQ Technologies is also testing similar solutions. All of this is still in early-stage technology, with many questions remaining—such as how it will impact future transaction speeds or whether post-quantum transformations can withstand pre-quantum attacks. The emergence of competition validates the market demand and also indicates that the ultimate solution may come from a combination of multiple companies’ technologies.