The Bitcoin Mining Industry’s Next Phase in Era of Quantum Computing
(NASDAQ.com) Last week, bitcoin finally surpassed its all-time price high, exceeding $23,000 for the first time, seeing year-to-date gains of over 180 percent.
This was largely attributed to growing institutional interest, with established names such as Square, Galaxy Digital and Grayscale Investments all helping to push bitcoin’s scarcity to new heights. Meanwhile, renowned market index providers have made promising announcements, with S&P Dow Jones Indices announcing the launch of crypto indices in the coming year.
The mechanics that have anchored Bitcoin over the years — success has rested on an ever-growing ecosystem of miners and their trusty hardware. Over the years, Bitcoin mining has fast cemented its position as a lucrative industry.
This article discusses numerous aspect of future bitcoin mining, the summary below concentrates on quantum technology’s potential effect.
Bitcoin mining players are keeping watch of emerging fields in supercomputing. These technologies have the potential to challenge existing hardware in terms of speed, but also in terms of security — posing a threat to the cryptography that underpins bitcoin and the majority of crypto assets today.
In the case of Bitcoin, the security of asymmetric cryptography is intrinsic to its overall security functions as much as being one of its core value propositions. However, as early as 1994, the publication of Shor’s quantum algorithm posed an existential threat to any systems leveraging asymmetric encryption due to its ability to break the latter’s security assumptions.
Research from Deloitte found that 25 percent of all bitcoin in circulation are potentially vulnerable to a quantum algorithm attack — provided that quantum computers can meet the Bitcoin network’s current transaction throughput of approximately 10 minutes. Thankfully, today’s ASICs currently maintain a 10-year speed advantage over quantum computers. That being said, should quantum computing play a part in writing the next phase of crypto mining, benefits are likely to emerge in the case of a long-term reduction in operational costs.
Though risks abound, the past years have shown that a stringent commitment to research and development across the board has enabled the technology to mature, ushering in a fresh wave of institutional and commercial interest — and this growing demand is set to catalyze a new phase of growth in bitcoin mining.