Technological Race Between Blockchain and Quantum Computing
(TheFool) There’s a technological race going on: blockchain vs. quantum computing.
Theoretically, major leaps in quantum computing could undermine the whole cryptocurrency industry — just as that nascent blockchain technology is entering the mainstream.
Blockchain is the technology behind Bitcoin (BTC) and other cryptocurrencies. It works by breaking data into blocks secured by clever cryptography. That cryptography is what makes it possible to cut the middlemen — banks and governments — out of financial transactions. It’s also what quantum computing might unravel.
It’s estimated that in the next 10 years, quantum computers will be able to process data fast enough to solve the algorithms that keep cryptocurrency safe.
Here are two of the big concerns:
–Public-private keys. These keys are a crucial part of crypto. If you send Bitcoin to another person, you use their public key — a bit like an email address — to do so. The recipient uses a private key — like an email password — to unlock the transaction. Just as having someone’s email address doesn’t let you access their account, so having a public key doesn’t let you access someone’s crypto. However, quantum computing could, theoretically, allow a hacker to do just that in certain scenarios.
–51% attacks. Another crucial aspect of the blockchain is the way the blocks that record transactions connect, and how new ones are added. If a bad actor introduces a fake block with fake information, that block is rejected by the other blocks on the chain. If however, a hacker took control of more than half the blocks on the network, it could be problematic. There are limits on how much a hacker could gain, but in theory, the speed of quantum computing might make this type of attack more likely.
The good news is that this is a known problem. And it won’t happen overnight — quantum computers won’t suddenly make the leap to cracking crypto. According to computing experts, we’ll know well before it actually happens.
More importantly, as quantum computing is evolving, so is blockchain technology. Some developers are already looking at forms of post-quantum cryptography. This is enhanced encryption that can’t be cracked by quantum computers, and specialists are pretty confident they’ll succeed.
We’ll also almost certainly reach a time when cryptocurrency investors will need to transfer their funds to more-secure wallets. And since data firm Chainalysis estimates that 20% of Bitcoin is currently lost or stuck in wallets people can’t access, there’s a chance these coins (which can’t be moved) will be more vulnerable to attack.