How Can We Secure Bitcoin Wallets in the Era of Quantum Computers?
(AnalyticsInsight) Thorsten Groetker, former Utimaco CTO and one of the top experts in the field of quantum computing, “If I was dealing in fear-mongering. I’d tell you that among the first types of digital signatures that will be broken by quantum computers are elliptic curves, as we use them today, for bitcoin wallets”.
Fred Thiel, CEO of cryptocurrency mining specialist Marathon Digital Holdings said, “Every single financial institution, every login on your phone is based on asymmetric cryptography, which is defenseless against hacking with a quantum computer”. Thiel is a former director of Utimaco, one of the largest cryptography companies in Europe, which has worked with Microsoft, Google, and others on post-quantum encryption.
The public-private key pair allows users to generate a digital signature, using their private key, which can be verified by anyone who has the corresponding public key.
In the case of cryptocurrencies such as bitcoin, this digital signature is called the elliptic curve digital signature algorithm, and it ensures that bitcoin can only be spent by the rightful owner.
In a way, someone using quantum computing could reverse-engineer an individual’s private key, forge his digital signature, and subsequently empty his bitcoin wallet.
Castle Island Ventures founding partner Nic Carter believes that quantum breaks would be gradual rather than sudden.“We would have plenty of warnings if quantum computing was reaching the stage of maturity and advancements at which it began to threaten our core cryptographic primitives,” he said. “It wouldn’t be something that happens overnight”.
Experts say that quantum hacking is only preventable if quantum cryptography encryption keys are so entangled that even the most advanced quantum computers cannot break them. The only drawback to this is that continual encryption would lead to very lengthy keys that would ultimately slow down the process.