The Future of Bitcoin Is Threatened by Quantum Computers

Two technologies that could shape the future — blockchain and quantum computing — could potentially be at odds. While the former provides secure, decentralized transactions, the latter could just as easily render these vulnerable to hacking.

While much of the world is captivated by the meteoric rise of bitcoin’s value, others are focused on the technology behind the cryptocurrency: blockchain. The decentralized digital ledger tech is built upon a peer-to-peer network, and it is far more secure than the centralized systems used by traditional banks and financial institutions. However, another revolutionary technology is now threatening Bitcoin’s security.

In a recently published paper, Divesh Aggarwal and his colleagues from the National University of Singapore (NUS) examined how quantum computers could undermine and even exploit Bitcoin’s security protocols.

As explained by theMIT Technology Review, these protocols use algorithms to turn data into mathematical functions. Every transaction is recorded into “blocks” using these functions as part of the computationally demanding work of cryptocurrency mining.

These cryptographic protocols make cracking a blockchain using today’s computers practically impossible, but the system does have weak points quantum computers could exploit.

For their paper, Aggarwal and his colleagues examined how quantum computers could break through Bitcoin’s security in two ways: by mining more than classical computers can and by cracking Bitcoin’s cryptographic keys.

If a miner controls more than 50 percent of the computational power on a blockchain network, they can use that majority control for malicious activity. The researchers found that the application-specific integrated circuits (ASICs) currently used by most cryptocurrency miners should be able to maintain a speed advantage over quantum computers for the next 10 years, so miners likely won’t be able to use quantum systems for nefarious purposes in this manner for at least a decade.

As for cracking today’s cryptographic keys, part of Bitcoin’s security protocol involves every bitcoin owner possessing two encryption keys: a private one and a public one. The latter can be easily generated using the former, but the reverse is far more difficult. An owner’s signature is verified without revealing the private key using a technique called elliptic curve signature scheme.