Bitcoin,  Security,  Technology

Could Quantum Computing Mean the Death of Crypto?

Interest is growing in cryptography resilient to quantum attacks

Contained in the bizarre world of quantum mechanics—where physical matter has properties of both particles and waves, and subatomic particles exist in multiple states at one time until observed—may lie the key to unparalleled computational speed. While still highly experimental, governments have been investing in research into “quantum computing” for years, and a recent article in Wired notes that last year venture capitalists “plowed a record $1.8 billion into companies working on quantum computing hardware or software worldwide…nearly five times the amount invested in 2019.”

Whereas the basic unit of information in traditional digital electronics is the bit (a logical state with two possible values, typically expressed as 0 and 1), quantum computing employs the “qubit” to harness the probabilistic nature of quantum states to reduce exponentially the number of operations that are currently required to perform extremely complex calculations—those which require enormous amounts of time for traditional computers to complete.

From cracking complex scientific mysteries to decoding financial models, future quantum computers could usher in a new era of computing. But this promise could also undermine the security of blockchain networks, including Bitcoin. The potential exposure of public keys, the theft of funds—and thus the transformation of cryptocurrencies as we know them—are realistic challenges.

SHA-256 is to blockchain security what a keystone is to an arch, providing stability and strength where lesser algorithms falter. SHA is an acronym for “secure hashing algorithm”, and the output is always 256 bits (hashing being a deterministic one-way process for transforming any string of characters into a fixed value; e.g., when you create a password for a website, the site saves a hash of it in its database for comparison to your future logins, not the password itself).

Utilized by Bitcoin, SHA-256 is regarded as likely to be more quantum-resistant than other algorithms. However, as the looming shadow of quantum computing grows, the question arises: how long can SHA-256 withstand the quantum tide?

Should quantum threats begin to diminish the resilience of SHA-256, the impact on cryptocurrencies using it could be profound (Ethereum, the second largest crypto by market capitalization, uses Keccak-256, a variation of SHA3-256, which is an evolution beyond the SHA-2 family that SHA-256 is in). Developers, regulators and users may find themselves in a race to adapt to new security protocols. Coordination across different blockchain networks, adoption of quantum-resistant algorithms and a comprehensive understanding of the potential risks would become essential to maintaining integrity and trust within the ecosystem.

There’s a growing interest in developing cryptography resilient to quantum attacks. Unlike earlier algorithms such as RSA and ECC, quantum-resistant algorithms offer a secure alternative. Some prominent candidates include:

  • Hash-based Signatures: Relying on cryptographic hash functions, they can resist quantum attacks. Examples include Lamport signatures and Merkle signatures
  • Code-based Cryptography: These use error-correcting codes and provide quantum resistance. The McEliece cryptosystem is a well-known example
  • Lattice-based Cryptography: This category includes schemes based on lattice problems, which are thought to be hard even for quantum computers. NTRU and Learning with Errors are examples in this category

Several organizations and cryptocurrencies are actively working to protect against potential quantum threats. The U.S. National Institute of Standards and Technology (NIST) has been leading an international competition to standardize post-quantum cryptographic algorithms. Cryptocurrencies such as QRL (Quantum Resistant Ledger) are entirely dedicated to implementing quantum-resistant signatures.

The path to quantum-resistant blockchain isn’t straightforward. Development and implementation come with challenges, including increased computational resources leading to reduced efficiency. There’s also the risk of compatibility issues with existing systems and the potential for unforeseen vulnerabilities, as merging quantum-resistant methods with current blockchain systems is a complex endeavor. Lattice-based cryptography, for example,  would demand reconfiguring the cryptographic core of some blockchain protocols. These challenges are on the radar of many in the crypto community, and active research is aimed at striking the right balance between security, efficiency and practicality.

The quest for quantum resistance in encryption technologies is a moving target. Predicting a timeline is challenging due to the dynamic nature of both quantum computing and cryptographic research. However, given the current interest in the field it is not unrealistic to expect significant strides toward quantum-resistant systems within the next decade.

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Colin is a crypto evangelist hoping to leave the world a better place than he found it.