A warning that artificial intelligence (AI) could neutralise cryptographic security for Bitcoin and Ethereum wallets faster than expected has reignited debate over the design structures of the two blockchains. Blockstream CEO Adam Back criticised Ethereum’s early architecture, and the industry has also raised the need to shift to next-generation cryptography.

On Oct. 10 local time, blockchain outlet U.Today reported that Ethereum researcher Justin Drake (저스틴 드레이크) said in a post on X, formerly Twitter, on Oct. 8 that the crypto industry should be prepared for “bunker mode”. He warned that, in the worst case, AI could find ways to break the cryptography protecting Bitcoin and Ethereum wallets in months rather than years.

Drake urged large cryptocurrency holders to consider gradually moving funds to new addresses to prepare. He said this was a warning based on a worst-case scenario, and it has not been confirmed that AI can actually neutralise current cryptographic systems within months.

Back criticised Ethereum’s early design direction following Drake’s remarks. He said early Ethereum developers, without sufficient experience, “reimplemented around an obviously broken architecture”. Referring to the unspent transaction output, or UTXO, model adopted by Bitcoin creator Satoshi Nakamoto, he also suggested that Satoshi appeared to have understood the characteristics of distributed systems.

At the core of the dispute is a difference in the ledger management methods adopted by Bitcoin and Ethereum. The UTXO model manages unspent transaction outputs as units of assets. When a transaction occurs, it consumes existing outputs and creates new ones. Bitcoin is a representative adopter, and Cardano uses a similar structure.

Ethereum, by contrast, uses an account-based model. It maintains per-account balances and the state of smart contracts, and updates that state when transactions occur. The two models differ in how they manage assets and transaction state, but neither structure alone can solve cryptographic security problems if quantum computers or AI advance.

Ethereum is also conducting technical experiments to improve transaction flexibility and security while keeping an account-based structure. According to the outlet, Ethereum Improvement Proposal (EIP) 8141 has been presented as a plan to pursue native account abstraction and the introduction of quantum-resistant technology through a new transaction type, 0x06, called a “frame transaction”. It remains to be further verified whether such designs would be a practical defence against the possibility of AI decryption.

Ethereum co-founder Vitalik Buterin (비탈릭 부테린) said investors do not need to move assets immediately. He said he does not recommend that anyone rush to transfer assets to new wallets at the current stage, but stressed that threats to cryptographic technology as AI advances should be taken seriously.

Buterin also said attention should be paid not only to cryptography vulnerable to quantum computers but also to cryptography that could prove vulnerable as AI develops. He suggested this does not mean existing wallets are immediately at risk, but that long-term cryptographic safety should be reviewed given the pace of advances in new computing technologies.

The dispute shows how AI advances could affect the security assumptions of existing blockchains. Separately from arguments over structural differences between the UTXO and account-based models, actual security threats vary depending on factors such as the cryptographic algorithms used in wallets, whether public keys are exposed and the computing power required for an attack.

Key questions going forward are whether AI will reach a level where it can actually attack existing cryptographic systems and how quickly new security systems, including quantum-resistant cryptography, will be introduced. For now, a claim that large-scale wallet migration is urgent has not been confirmed as an official security recommendation, making it necessary to distinguish between worst-case scenarios and verified technical risks.

This basically means... Charles always knew accounting model was a wrong choice. I am glad he parted ways with shitty ETH early! I am glad #Cardano ended up being on the right side of blockchain history! UTXO FTW! I am so happy Charles didn't just leave UTXO and go to account model like all he other sheeple just because "Smart contracts on UTXO were difficult to implement".. $ADA was always on the right side from its inception!