Quantum Computing is on its way and will plunder your crypto

MUCH of blockchain’s allure arises from its security attributes. No single user can break into and change the ledger. This makes it both public and secure.

However, combined with another emerging technology, quantum computing, blockchain’s seemingly immutable ledgers would be under threat.

Quantum computing uses quantum bits or “qubits” that can exist in any superposition of values between 0 and 1 and can therefore process much more information than just 0 or 1, which is the limit of classical computing systems.

A classical computer calculates in a linear fashion, meaning a bit is only ever 1 or 0. In contrast, the quantum physical properties of superposition and entanglement mean a qubit is both 1 and 0 at the same time, which allows for exponentially greater computing power.

The ability to compute using qubits makes quantum computers significantly faster than classical computers. Google showed a quantum computer could be 100 million times faster than classical computers at certain specialized tasks.

It should be noted that Google and IBM are actively working on their own quantum computers.

This advance will pose an existential threat to public key cryptography, and the blockchain technology that relies on it. Although there are but a handful of quantum computing algorithms, one of the most famous ones, Shor’s algorithm, allows for the quick factoring of large primes.

The only way to crack most of our current encryption is to reverse factor a large semi-prime number to its original primes. This kind of calculation takes eons for a classical computer, but will be instantaneous for a large quantum computer.

Therefore, a working quantum computer could, in theory, break today’s public key cryptography.

It is worth noting however, that Satoshi Nakamoto’s original Bitcoin were Hack-able but have since been made Quantum-proof.

This doesn’t mean your other crypto assets are safe.

Michael Staw, pioneer of online gambling, former Microsoft software engineer, and current hedge fund manager, believes quantum computing is the first major shift in computing since the original John Von Neumann architecture.

The Princeton graduate, who holds 4 patents in mathematics and is cited in over 100 patents, is concerned that “if you could solve a block instantly, then you could own the mining industry, rewrite the blockchain, double spend, and do a 51% attack”.

He went beyond blockchain in saying “security on the web and https will be blown away by quantum computing well before blockchain attacks will happen”. He did not offer an exact estimate on when these situations would be viable, but added that within the next decade is possible.

Although most discussions on quantum computing are on the negative impacts, Mr. Staw was very optimistic about the possibilities of “a blockchain which has its encryption stored as a quantum hash”. This would make it equally as hard to solve the hash for a quantum computer as a regular hash is to solve for a regular computer.

The only issue would be what we do in the near term. According to Mr. Staw, “coins with shorter cycle times will be more protected against the setup and tear down of quantum computers”. For example, Bitcoin which has roughly a 10 minute block time will give a quantum attack much more time to set up and solve than Ethereum which has a 14 second block time.

He believes that “shorter cycle times will buy some projects enough time to fork into better solutions. It will be survival of the fittest at that point, and whoever can get consensus to fork into something more quantum resistant will survive.”

Quantum computing could very likely be the end of proof of work consensus protocols and our reliance on computing power, which allows centralization and is extremely energy inefficient. Public key cryptography and cyber security will definitely be transformed as well. The future of the internet is, as always, both murky and exciting.

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