What Quantum Computers Mean for the Future of Blockchain

What Quantum Computers Mean for the Future of Blockchain. Bitcoin and blockchain technology generally has the potential to make an incredibly positive impact on the world — if it can survive the threat of quantum computing. 

Bitcoin-mania may have passed but the blockchain revolution it kicked off is quietly humming away. Financial institutions, governments, and start-ups are all finding innovative ways of using blockchain to build fairer, more robust systems. However, some observers worry that it could all unravel by another groundbreaking advance: quantum computers. 

Why Is Quantum Computing a Game-Changer? 

Harnessing the power of quantum computing will help propel humanity into the next stage of its evolution. Quantum computers draw on the almost mystical properties of quantum physics in order to process vast amounts of data at an unprecedented speed. 

Embed: https://www.youtube.com/watch?v=JhHMJCUmq28 

An excellent quantum computing explainer for the uninitiated

Instead of relying on 1s and 0s (bits) to represent data, quantum computers are able to use a qubit, a two state quantum system. This allows a quantum computer to process a large number of different outcomes simultaneously, rather than being forced to process a huge string of binary code, Quantum computers are designed to capture and contain qubits in a stable state and then leverage two important aspects of quantum mechanics to process large amounts of data. 

  • Superposition: Qubits can hold all possible combinations of 1 and 0 simultaneously. This allows a quantum computer with multiple qubits to process a large number of different outcomes simultaneously. As a quantum computer holds more qubits, its processing power grows exponentially. 
  • Entanglement: Quantum Computers can generate qubits that are entangled, this means that possible change to the state of one qubit, and predictably alter the states of other qubits that it is entangled with. This allows running multiple calculations simultaneously, squeezing more processing power out of a single qubit.
Image via Pixabay What Quantum Computers Mean for the Future of Blockchain

The potential applications of quantum computers are incredible. We are collecting more data than ever before and quantum computers are perfect for processing it. This is particularly true when it comes to research projects that require understanding multiple outcomes, such as predictions or simulations.

As quantum computers grow in power it will become easier for us to process increasingly complex simulations. This will have extra effects in countless sectors and fields of study, rapidly accelerating human progress.

A Looming Security Threat 

The same properties that make quantum computers excellent for research make them a major security threat. Your entire online life could be endangered by quantum computers: from your passwords to your whatsapp messages and even to your online banking. This is all dependent upon cryptography, which is the same technology that powers blockchains and cryptocurrencies. 

There are three main kinds of cryptography: 

  • Symmetric-Key Cryptography: Both the sender and receiver use a single key. The sender encrypts plaintext and gives the ciphertext to the receiver. The receiver can apply this key to decrypt the message and recover the plain text. This is one of the oldest forms of encryption and is relatively rudimentary. 
  • Public-Key Encryption:  One of the major advances that makes blockchain technology viable. Two related keys, the public key and private key, are used, the public key can be shared without revealing the identity of the private key, the public key is used to encrypt the data and only the private key can decrypt it. 
  • Hash functions: A fixed-length hash value is computed which makes it difficult to recover the contents of the plain text without brute-forcing it using sheer computing power, this is often used to encrypt passwords and also for cryptocurrency. 

Cryptocurrency & Blockchain

All cryptography relies on mathematics to protect it. Without the correct key, computers process incredibly complicated calculations. This means it could take years, or even centuries, to brute force a properly encrypted file. This is also the basis of Proof of Work cryptocurrencies like Bitcoin and what helps to secure them. 

The vast processing power of quantum computers could render this protection worthless overnight. It would be theoretically possible for bad actors to rip away the protection of encryption and reveal the contents of a file without the key. This would be particularly dangerous for blockchains. As a quantum computer would then be able to process fraudulent transactions or data. 

Efforts Are Underway to Counteract This

The threat is likely still in the distance. Decoherence means that even small changes in temperature, slight vibrations, or other variables can cause a quantum computer to break down. This means that for the moment they are not viable. And this gives cryptographic experts and blockchain companies time to prepare. 

In the general cryptography world, the main effort is towards building quantum-proof cryptography. The NIST launched a competition in 2016 to develop new standards in cryptography and while the winners have not yet been announced, a consensus seems to be forming around the best approach: lattice-based cryptography. 

Instead of using traditional math to encode data, lattice-based cryptography uses grids with billions of individual points across thousands of dimensions. Breaking the code would require finding the correct path from one specific point to another, which is difficult without the map or key. It’s important to note that the keys required to unlock lattice-based cryptography would need to be small enough to be practical in real-world use. 

For blockchains, there are a few key problems. The first is user behavior. Novice crypto users, or those engaging in proof of stake (PoS) blockchains, often reuse one wallet address. This means that a quantum computer could use the public key to find and break the private key, stealing the contents of the wallet. The second threat is that quantum computing could be used to more easily cause a 51% attack on proof of work (PoW) blockchains. 

Particl and Cold Staking 

Proof of stake Relies on users “locking” a specific amount of their currency in order to secure transactions on the blockchain. It is less energy-intensive than proof of work. Unfortunately, most forms force a user to reveal their public address to gain access. Given that most people will be keeping their coins in a single wallet, this is a huge security flaw. 

One solution is cold staking. This approach leverages multi-signature addresses so you can stake from multiple computers. Users would then be able to spend their money through a mobile wallet.

As the stake-only machine is broadcasting a public key different from the mobile wallet key, it is almost impossible to link the private and public keys. In order to steal coins an attacker would need to know both keys, which requires more than a quantum computer. 

Improving Proof of Work with the QRL

PoW remains one of the most popular consensus methods, and Bitcoin employs it as well. For the moment, quantum mining is unlikely to be profitable but a bad actor may have motivations other than profit. 

In order to fully protect from the threat of quantum computers, projects like the Quantum Resistant Ledger (QRL) have sprung up. The QRL is the first industrial implementation of the eXtended Merkle Signature Scheme (XMSS). This hash-based signature scheme is more advanced than ECDSA and should be significantly more difficult for a quantum computer to crack.

A Distant Threat That Needs Solving in the Present 

The big challenge for cryptography specialists and blockchain developers is that cryptography moves slowly. It can take 10 or 20 years to standardize or implement new cryptographic algorithms into products. If moves aren’t taken now, the cryptographic community could find itself unprepared for the quantum future.

IBM Research Chief Scientist Ruchir Puri On Quantum Computing And No Code Machine Learning What Quantum Computers Mean for the Future of Blockchain
What Quantum Computers Mean for the Future of Blockchain